Chinese Landlords Are Canceling Store Rentals For Zara Volkswagen Brand.

< p > to reduce the impact of the increase in vacancy rate due to the construction of shopping centres, Chinese landlords are canceling store rentals for popular brands including Zara and H&M.

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Less than P, until recently, preferential rental terms were still exclusive to international luxury brands, because they were popular for shopping centres to attract customers.

But consulting firm New York high latitude global said that as Chinese landlords are trying to fill their shops, the mid priced brands are also being tempted by various preferential conditions.

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< p > China's consumption demand is cooling down due to economic slowdown and leaders' suppression of officials' extravagance and waste.

Landlords who focus on the two or three tier market will be under greater pressure because smaller cities are expanding their retail space faster than big cities.

Insiders said: "the competition in China's commercial real estate market is very fierce, especially those new shopping centers located in the two or three line city's non central business district."

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< p > with the growth of consumer spending and income, developers have built more shopping centers in China and expanded to smaller cities.

According to statistics, China occupies half of the 32 million square meters of shopping centers currently under construction.

By tracking 20 cities in China, Gao Wei said that next year it will be expected to build a retail area of about 21 million square meters, with an increase of 38% in supply.

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P, with retailers in the world including Louis Weedon and Gucci shrinking growth plans in response to slower growth in the world's most populous countries, developers are facing challenges.

Second tier cities such as Chengdu, Shenyang, Hangzhou and Qingdao will fall into the dilemma of the highest vacancy rate in shopping centres in 2014.

Next year, in some relatively less prosperous cities, the vacancy rate will increase to more than 30% from 6.8% in the first quarter of this year.

"The problem we see in China is due to a lack of rational planning," said Sigrid Sialsita, head of Global Asia Pacific research.

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By the end of 2015, the shopping center area of 4 big cities in Beijing, Shanghai, Guangzhou and Shenzhen will increase by about 40%, and the supply of 16 smaller cities will double in the same period, said P, director of the Shanghai district director of the Chinese research department, Jones Lang LaSalle.

Experts say that some developers' new shopping centers will reach 70% vacancy rate and will be forced to postpone the opening.

According to the introduction, in developed markets such as Hongkong and Singapore, due to limited supply, the vacancy rate is only between 6% and 7%.

Du Jinsong, a real estate analyst at Credit Suisse Bank in Hongkong, said that despite the controversy over whether China's housing market has been oversupplied, it is a consensus that its commercial real estate sector has been oversupplied.

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