Many real estate developers respond to the call of fighting epidemic and tide over difficulties with tenants. (By Leong Yuet-Kam) The COVID-19 epidemic brings operation difficulty to many industries. REDA rarely issued a statement a few days ago. That is, its members will continue to discuss various feasible measures, including rent reduction, with tenants in need to relieve their operating pressure, because of the current difficult situation in the retail catering industry. Many developers responded immediately yesterday, reducing the basic rent in February of some tenants of their malls by up to 50%. (For other news related to the epidemic, see B1 and B2) Canton Road, Tsim Sha Tsui's famous shops were crowded in the past. Nowadays, the flow of people is sparse. There are few visitors to the shopping malls. So the business of commercial tenants dipped. The Wharf Limited's Harbour City sent an email to tenants yesterday. It states that the COVID-19 has brought unprecedented challenges to Hong Kong and the retail market. The mall understands the difficulties and will work with tenants to overcome the crisis. It is implementing a series of measures to combat the epidemic to protect customers and Tenants. The email also expresses the mall decides to reduce the rent in February by 50% and says details will be confirmed later. Harbour City: We will reduce the rent of this month by 50%. Harbour City Mall responded yesterday that it had signed confidentiality agreements with all tenants, and all the negotiation content and contractual arrangements could not be disclosed. Harbour City has a total floor area of ​​2.068 million sq ft and more than 450 shops, including about 60 restaurants and a cinema. Wharf Real Estate's 2019 annual report has not been published. According to its 2018 annual report, the retail sales of Harbour City in 2018 reached HKD37 billion, accounting for 7.6% of the total retail sales of Hong Kong in 2018 of HKD485.169 billion. The average daily turnover of the tenants exceeds HKD100 million. The monthly sq ft rent was HKD2,700 during the period. Retail sales and monthly sq ft rent both were historically high. SHKP: We will reduce the basic rent by 30-50%. Sun Hung Kai Properties has a total of 12 million square feet of a retail property portfolio in various districts in Hong Kong. It also announced yesterday that, to help stabilize the economy and protect employment, it is actively learning about the operating status of its mall merchants and would reduce or exempt the basic rent in February by 30-50% according to individual industries or the situation of the business tenants. It will working with tenants through difficult times. And SHKP initial estimates the relief measures will benefit most tenants. A spokesperson for SHKP points out that the group is particularly concerned about the catering industry, which employs a large number of front-line staff, and hopes that the relief measures will help reduce their operating pressure. In fact, since the outbreak of the COVID-19 epidemic in January, many of the group's businesses, including property sales and hotel occupancy rates, have been affected to varying degrees. New World's K11 reduces rents by individual merchants. New World 's K11 Shopping Mall in Tsim Sha Tsui will also reduce rents of February according to conditions of individual tenants, helping merchants reduce their operating pressure and cope with the difficult times. A spokesperson for K11 expresses that the retail industry is the first to bear the brunt of the COVID-19 epidemic, and the company would always maintain communication with the tenants. Besides, the reduction range will depend on individual cases, because the impacts on tenants vary. In addition to a rent reduction, the company also provides appropriate and targeted relief measures for different tenants, including strengthening publicity and promotion to improve the business environment. Swire Properties: The company is the first batch of developers to support merchants by rent reduction. A Swire Properties spokesman expresses that the group is one of the first batch developers to provide short-term rental adjustments to support tenants since the influence of social activities appeared last year. It would also assist tenants according to specific operating conditions. The group will continue to liaise closely with tenants and work with them through difficult times. To improve the operating conditions faced by individual shopping mall tenants, Hang Lung has recently announced to maintain the rent concession measures used in response to social events in the second half of last year for its Hong Kong shopping malls. The Chairman of the Executive Committee of The Real Estate Developers' Association (REDA), Leong Chi-Kin, expresses that rent reduction is only one way, and some large tenants can still afford it. They have directly discussed with the landlords on rent reductions. He also points out that the relief measures offered by different developers vary, and everyone hopes to ease the pressure on tenants. The retail business is estimated to dip a future 60%. The COVID-19 epidemic heavily hit the tourism, catering, and retailing industries in Hong Kong. A survey released last Thursday by the Hong Kong Retail Management Association revealed that the average business volume of most local retailers fell by up to 50% during the 10-day Spring Festival period from January 24. The retail industry is entering a "super cold winter." Association members also expect that the business volume from February to March will still fall by 40% to 60% under the expansion of the COVID-19 epidemic. The Association points out that there will be a massive wave of closures, and Hong Kong's economy will be further hit if the retail industry fails to receive timely and appropriate support.