China malls closing despite data showing retail sales rebound

Shanghai

THE Di Mei shopping centre in downtown Shanghai is a surprisingly depressing place to shop.

The underground mall is located in one of the most shopping-mad cities in China, and yet it is run down and starved of customers. "Sometimes I cannot sell even one dress in a day," said dress shop owner Ms Xu, who rents a space in Di Mei.

Rising vacancy rates and plummeting rents are increasingly common in Chinese malls and department stores, despite official data showing a sharp rebound in retail sales that helped the world's second-largest economy beat expectations in the third quarter. The answer to that apparent contradiction lies in the rising competition from online sh…