Adidas Originals is riding a hot hand in China:

First: while fashion trends are shifting away from streetwear, adidas Originals has been able to find a balance between street and performance.

Second: its move into community-anchored locations like Zhangyuan — outside traditional malls — reinforces that balance. These stores feel less transactional, more lived-in, and better suited to building local relevance.

Some of the formula is about getting the balance between street and performance right

...but I also think Adidas Originals are benefiting from a 'nostalgia' trend in China currently.

Adidas was an early mover in China's street movement and so has been able to echo from the past. Community shops, especially in areas like Zhangyuan, are exemplars of this connection to nostalgia, discovery & storytelling.