American lingerie giant Victoria’s Secret is the latest to succumb to struggles of Hong Kong’s retail industry amid the coronavirus pandemic, as it shut down the local flagship store and laid off all staff on Thursday without prior notice.



The abrupt closure of the six-storey Victoria’s Secret mega store in the city’s shopping district of Causeway Bay might cost the company HK$630 million (US$81.3 million), as it is breaking a 10-year lease signed in 2017.



The lingerie brand set up shop in Hong Kong in September that year and took up the 51,188 sq ft of shop space for a staggering HK$7 million per month under a lease that was to run until August 2027. According to standard leasing terms in the city, Victoria’s Secret must fork out 90 months of rent — totalling HK$630 million — for a premature termination.



At the Causeway Bay store, a notice of store closure was displayed on the shopfront. It also informed customers that online shopping services would still be available. Apple Daily learnt that the entire staff was made redundant on Thursday night, but the Hong Kong office of Victoria’s Secret declined to comment.



Victoria’s Secret also shuttered six other outlets previously, and the closure of the flagship store signaled that the lingerie brand famous for its iconic models with wings strutting down the runway could be exiting Hong Kong permanently. Local retail sales plummeted by a record 44% in February.



Victoria’s Secret has been hard hit globally during the economic downturn brought by the ongoing coronavirus pandemic. Its parent company, L Brands, earlier announced that total sales fell by 37% in the quarter ended May 2. None of the company’s stores had opened for business since March 17.



The company announced last month that it would be closing 250 stores in the United States and Canada in 2020. Earlier this month, the Victoria’s Secret business in the United Kingdom filed for bankruptcy, eight years after its launch in the country.



Meanwhile, French luxury fashion house Chanel was said to have furloughed or laid off over 100 staff members in Hong Kong, and was accused of denying the staff’s right to fair treatment and compensation.



One Chanel employee who refused to be named told Apple Daily that the company had to downsize its manpower amid the virus-induced economic downturn and ongoing anti-government protests.



The employee said that they were given two options — to sign a redundancy agreement and take a one-month payout worth about HK$10,000, or to take no-pay leave of four months, until October — but Chanel could not guarantee if those staff members would still have a job after the no-pay leave ended.



Good performers among the staff were asked to cut their working hours from 40 to 20 per week between July and November, so they would receive only 60% of the base salary and 50% of the commission, the employee said. It was understood that Chanel management and staff could not agree on the compensation and some had sought help from the government’s Labor Department.



Chanel did not respond to Apple Daily’s request for comment.

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