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As Shanghai Locks Down, Luxury Retailers Face New Challenges

Two weeks after Shenzen was put under lockdown, China’s commercial hub Shanghai put half of its city under quarantine Sunday evening as daily COVID-19 cases surpassed 3,500.

The area of the city that lies east of the Huangpu River, which divides the city into two parts, as well as some areas in the South, will be put under lockdown for eight days from Monday, and the other half will begin a five-day lockdown on Friday.

The eastern part of Shanghai, including the Pudong New Area, where the Lujiazui Central Business District is located, is the beating heart of the city’s financial industry. It is filled with office buildings, high-end hotels, luxury apartments and up-market shopping malls, such as Shanghai IFC, which is crowded with luxury flagships, and L+ Mall, where the city’s Galeries Lafayette is located. This area logged 1,424 cases on Sunday, the highest in Shanghai.

This part of the town also includes Qiantan, an up-and-coming business area where Swire Properties opened its third Taikoo Li shopping complex in China last September, attracting major players like Louis Vuitton, Balenciaga and Hermès since opening.

All public transport in the region has suspended operations. Only vehicles that are used to assist pandemic control, deliver daily necessities and handle emergencies are allowed on the street. But airports, railway stations and international cargo transports will operate as usual during the lockdown. The emergency departments of local hospitals will continue offering medical services as well.

Every citizen is required to receive two polymerase chain reaction tests during the lockdown. During that period, people living in non-key areas on the western side of the Huangpu River or communities that have yet to be quarantined will receive an antigen self-test.

The city so far still has 15 medium-risk areas, including one located in the Huangpu District, where top luxury malls and retailers including Sun Hung Kai Properties’ iAPM, New World Development’s K11 and Daimaru Department Stores, Wheelock Group’s Lane Crawford, Bailian Group’s TX Huaihai, Lai Sun Group’s Hong Kong Plaza and Shui On Land’s Xintiandi are located.

From Friday, when a lockdown will begin on the western part of Shanghai, it’s expected that the city’s luxury retail will take a bigger hit if the number of cases shows no signs of slowing down.

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