Rents Slide 15% in World’s Priciest Retail Market and More Asia Real Estate Headlines

Hong Kong’s economic hardships lead the news again today with a global property agency reporting that retail rents in the city dropped by 15 percent in the second half of 2019. Also in the headlines, one of India’s largest developers has decided to join the co-living wave, a Singaporean developer wins approval to develop a £300M hotel across the street from one of London’s most famous department stores, and Hong Kong developers are getting out the masks and disinfectant to fight a new virus. All these stories and more are in today’s headline roundup.

HK Retail Rents Fell 15% From July to December

Hong Kong landlords, used to charging top dollar for flagship stores, are suddenly in flash-sale territory. Prime retail rents dropped in late 2019, as social unrest disrupted commerce, scared away many of the mainland Chinese visitors who underpin luxury demand and helped push Hong Kong into recession.

With political turmoil in the semiautonomous city unlikely to end soon, real-estate firms expect rents in the glitziest enclaves to keep falling. Read more>>

India’s Embassy Group Unveils 20B Rupee Co-Living Initiative

Embassy Group on Tuesday said it will invest around 20 billion rupees to set up co-living or shared accommodation facilities across top six cities in India, targeting the growing millennial workforce and students in the country.

The Bengaluru-based real estate firm, which builds commercial office spaces, residential projects and also operates WeWork co-working offices in India, announced that it will operate its co-living business under the brand ‘Olive’. It plans to launch two centres each in Bengaluru and Chennai this year with a total of 2,500 beds. Read more>>

Singapore’s CDL Wins Approval to Build £300M London Hotel

Real estate company City Developments Limited (CDL) has been granted planning permission to build a luxury hotel on the site of the Pavilion Road car park in Knightsbridge.

The 120-room property will be designed by Tim Hamilton of Hamilton Architects. It will have eight floors above ground and three below ground, while the £300 million development will add 2,100 sqm of retail space, a spa and accommodation. Read more>>

Hong Kong Developers Clean Up to Fight Wuhan Virus

Hong Kong developers and property agencies are beginning to step up efforts to defend against the Wuhan virus amid heightened concerns that the outbreak could have a long-lasting impact on home and retail sales.

The Wuhan virus comes as the latest challenge to the industry that has yet to recover from the effects of eight months of anti-government protests and the US-China trade war. The virus, now proven to be transmittable among humans, has claimed four lives thus far, with cases reported in Hong Kong, Japan and South Korea. Read more>>

PAG Boss Says Will Invest $1B in India

Hong Kong-based private equity group Pacific Alliance Group (PAG) is looking to invest upwards of a billion dollars in India over the next three years to buy out targets, provide growth equity and even structured finance with an eye to fix broken balance sheets of India Inc.

“We have been following the economic situation in India for the past 20 years… But the macro-economic conditions are much more improved now. The growth rate has slowed down but is still steady,” said Weijian Shan, chairman and CEO of the buyout group that has invested over $50 billion across Asian PE and real estate while justifying its local debut in 2019, almost a decade after raising its first fund. Read more>>

Shangri-La Hotels to Raise S$250M Through Bond Sale

Shangri-La Hotel Limited, the wholly-owned Singapore subsidiary of Shangri-La Asia Limited, will sell new S$250 million 10-year bonds at par.

The senior unsecured bonds will carry a 3.5 per cent coupon rate, which is 183.7 basis points above the prevailing 10-year swap offer rate, according to the term sheet released on Wednesday. Read more>>

Japan-Focused Singapore REIT Boosts Distributions by 2%

Parkway Life Real Estate Investment Trust (PLife Reit) on Wednesday posted a 2 per cent rise in distribution per unit (DPU) to 3.34 Singapore cents for the fourth quarter ended Dec 31, 2019, up from 3.28 Singapore cents a year ago.

The increase was led by contribution from three Japan properties that the group acquired in December 2019, rental growth of existing properties, as well as cost savings from refinancing initiatives completed in 2018 and 2019, said PLife Reit’s manager. Read more>>

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