French luxury house Chanel has been reported to lease a two-level retail space in the Capitol Centre, which was previously home to the failed flagships of Victoria’s Secret and Forever 21. 

The company will use it to showcase its beauty range.

Local media reported the lease, starting from May 16, would last for three years with the right to two further three-year renewals. The monthly rent of more than HK$3 million (about US$383,000) marks the largest commercial rental deal since Covid-19.

Inside Retail’s sources report the rent may be closer to $4 million, which would be about half the price Victoria’s Secret was paying for three floors in the building.

Chanel will take over about 19,000 sqm of space, which comprises the ground floor, the upper floor and the four-level advertising exterior wall. Renovation work is reportedly already underway. 

The French label also has two stores in Times Square and Lee Gardens in the territory’s shopping district. 

The move comes at a time when Hong Kong’s retail industry steadily rebounds after the reopening of the border with Mainland China. The Census and Statistics Department (C&SD) said that for the first four months of this year, total Hong Kong retail sales have increased by 21.7 per cent year on year, with sales of jewellery and watches up by 75 per cent year on year in April alone.