Can Hong Kong’s fine dining restaurants adapt to survive? It’s a Michelin-starred struggle as economy dips and tourists seek value

Ton puts the failure down to “internal issues” with his local business partner, but he also says that the economy in Hong Kong is “not the best for fine dining establishments”.

“We saw a big drop in revenue from February,” he says. “Many people left Hong Kong and have not returned. Hong Kong just doesn’t have enough customers for all the fine dining restaurants.”

Why are Hong Kong restaurants struggling?

Times are tough for Hong Kong’s restaurants. In April, Simon Wong Ka-wo, president of the Hong Kong Federation of Restaurants and Related Trades, estimated that more than 700 venues had permanently closed in the previous few months. Just last month, American restaurant chain Outback Steakhouse announced it was closing nine restaurants – nearly half its presence in the city – and laying off 300 staff. “This decision is the culmination of a meticulous review process that considered current market conditions,” the company said in a statement.

The industry’s woes go beyond regional competition and thrifty tourists, with the tepid economic climate having an impact too – and it’s not just high street steakhouses that are suffering. As Ton’s woes reveal, even Hong Kong’s fine dining restaurants are being left with empty tables.

With the yen at its lowest level in decades, Hongkongers are heading to Tokyo and Osaka to spend their spare cash. Chef Fujimoto describes the current local market as more “difficult” and “volatile” than before. “Many people are flying again and the yen is so cheap that everyone goes to Japan to eat Japanese food,” he says. “We cannot compete on price with our neighbouring cities and Japan.”

All of this has created a ripple effect. With customers aware that many once-unobtainable tables are easier to get, guests are increasingly booking last minute, or walking in and seeing if any tables are spare. This makes it difficult for restaurants to manage kitchen supplies, an especially acute problem at establishments that pride themselves on serving the finest fresh ingredients. And although customer numbers are down, day-to-day expenses haven’t budged.

“Despite the challenging economic climate, running and labour costs have remained high. To maintain our high standards of food and service, we’ve had to absorb these costs, which has significantly impacted our revenue,” explains Li.

How is the F&B scene adapting?

Some chefs remain cautiously optimistic that they can weather the storm, while others are less upbeat. Many are embracing change, trying new ways to attract diners and build a loyal clientele that will keep coming back for more.

Chef Ton has turned his focus to Here Thai Market, a more affordable restaurant he opened in New Town Plaza in Sha Tin. “It’s a casual street food concept that I think perfectly fits the current economic situation,” he says.

Other chefs are offering more accessible dining options alongside existing menus. Balbi, for example, now offers a shorter lunch menu that serves as an “introduction to the experience with the same quality and same care but in a shorter window of time and at a more accessible price”. For evening seatings, Balbi changes dishes on his dinner menu regularly to ensure repeat guests can always try something new.

Balbi also has a full roster of guest chefs this year to keep things fresh: “We’re inviting many friends from all over Asia to cook with us, giving them the chance to showcase their cuisine at while offering our guests something new to be excited about.”

“We remain unwavering in our commitment to providing the finest ingredients and delivering an exceptional dining experience to our valued customers,” says Nakanoue, who has relocated from Osaka to Hong Kong to further build the reputation of his international-inflected sushi restaurant.

Should the Hong Kong government offer restaurants more support?

HKTB also arranged a culinary tour of Hong Kong for top chefs and food writers from around the world to showcase the variety in the city’s F&B industry.

But for some in the industry, the government’s promotion of Hong Kong as a luxury dining destination could go further.

Gokson believes Hong Kong restaurants should up their standards, too. “In Hong Kong, the focus seems to be on Michelin-starred restaurants, and there are plenty. But seriously, are they all that good?” asks the socialite, who says Sevva remained financially sound until their landlord terminated their rental agreement.

“My advice to restaurateurs would be to create their own thing and develop their own flair. Work with passion and there’s no need to copy,” she says. “A restaurant is defined by good quality, flavourful food, attentive service and great ambience from lighting, sound and the energy of the place. Simple as that!”