“While market conditions remain challenging, Hangzhou’s focus on niche consumer segments continues to drive steady retail growth.”

JAMES MACDONALD, SAVILLS RESEARCH



Niche Markets Drive Retail Expansion

Retail sales in the first two months of 2025 reached RMB142 billion, reflecting a 6.8% YoY increase. General retail sales grew by 8.7%, while F&B sales declined by 1.5% YoY. • No new projects were launched in Q1/2025, keeping the city’s total retail stock at 8.27 million sqm.

• Sports and outdoor brands, such as those in golf, road cycling, and children’s sportswear, opened their first stores in Hangzhou, targeting niche markets.

• F&B continues to dominate shopping mall demand, with dessert and milk tea brands remaining popular. Local cuisine brands continue to innovate.

• The citywide vacancy rate increased by 0.5 ppts in Q1/2025 to 10.4%, marking a 0.5 ppt YoY rise.

• First-floor rents in Q1/2025 fell by 0.3%, averaging RMB13.8 psm pday, a 0.5% decline YoY.

• Five new projects are set to open in 2025, adding 591,000 sqm of retail space.