French fashion label Lacoste SA will open its biggest Hong Kong store in the landmark Pedder Building, according to people familiar with the matter, the latest global brand betting on a city regaining its retail buzz after years of Covid restrictions and political upheaval.

The firm has leased a 5,000-square-foot space for about HK$1 million ($128,700) a month, the people said, asking not to be identified discussing a private deal. The century-old building, located in Hong Kong’s Central finance and retail district, is owned by the family of late property tycoon Henry Fok. 

Lacoste’s ground-floor space is part of a four-story megastore that was previously occupied by US clothier Abercrombie & Fitch Co. — which rented it for HK$7 million a month, local media reported, until moving out around 2016 as sales slumped. The floor leased to Lacoste had been left vacant for almost a decade. 

Lacoste didn’t immediately reply to a request for comment. Calls to the firm that manages the property went unanswered. The office of Kenneth Fok, vice president of the Fok Ying Tung Group and a grandson of Henry Fok, said he had no comment and was not in charge of the Pedder Building’s leasing or management. 

Lacoste, part of Swiss conglomerate Maus Freres Holding AG, is best known for its crocodile-logo clothing including polo shirts. The Hong Kong expansion comes as the city’s economy shows signs of recovery: Third quarter gross domestic product grew the most in nearly two years, beating all forecasts, while September retail sales climbed 5.9%, snapping 14 months of consecutive declines. 

Retail deals are also back on the rise. LVMH Moet Hennessy Louis Vuitton SE’s largest brand Louis Vuitton signed an agreement with New World Development Co. to open a 40,000-square-foot store in the developer’s signature K11 Musea mall. Swiss luxury conglomerate Cie Financiere Richemont SA’s jewellery label Vhernier will also open a new shop at the luxury Peninsula hotel. 

Still, analysts and observers are waiting to see whether the retail recovery will last. The city’s commercial real estate market remains weak, with prices of office units and retail space slumping more than 40% from their 2018 highs, according to government data. 

Lacoste’s new Pedder store has been one of the city’s most closely watched retail spaces, partly due to Abercrombie’s famous 2012 opening — which saw the US brand stage a parade featuring shirtless, muscle-bound men. The store’s cologne-drenched air, good-looking young staffers and pounding music became a lasting memory for many Hong Kong shoppers.