The Kwok family says they are buying the stake because they believe in Hong Kong
Hong Kong’s richest family leads the way in Mingtiandi’s roundup of Asia real estate headlines with the news that the billionaire clan, which controls Sun Hung Kai Properties, has bought a 25 percent stake in the office portion of the developer’s West Kowloon project, after the company snapped up the site at a discount last month.
In other news around the region, Allianz and Gaw Capital have secured a $698 million green loan to finance a Singapore purchase, India’s Godrej has spent $120 million buying into a Bengaluru office project, and China home price growth continues to taper off, reaching its lowest level in three years during November.
Kwoks Buy 25% of Office Element of West Kowloon Project for HK$9.4B
Hong Kong’s Kwok family will invest HK$9.4 billion ($1.2 billion) for a 25 percent stake in office towers set to be developed on a plot of land won by Sun Hung Kai Properties last month. The family is the company’s controlling shareholder and its investment is being viewed as a show of confidence in the city’s economy.
Hong Kong’s economy entered a technical recession in the third quarter amid anti-government protests that started in June and have since derailed its tourism, aviation as well as property sectors. Read more>>
SHK Compares HK Hotel Market to SARS
Sun Hung Kai Properties, Hong Kong’s biggest developer by value, said revenue at its hotels division had plummeted by up to half in November and December, as the city’s tourism industry struggled to stay afloat amid seven months of anti-government protests and the US-China trade war.
Revenue per available room dropped in these two months by 40 per cent to 50 per cent year on year, Adam Kwok, the company’s executive director, said on the sidelines of the launch of Alva Hotel by Royal in Sha Tin on Friday. Read more>>
India’s Godrej Buys Stake in Bengaluru Office Project for $120M
Godrej Fund Management has acquired a stake in a commercial office project in Bengaluru which is being developed by Century Real Estate Holdings Pvt. Ltd for around ₹850 crore ($119.8 million), said two people familiar with the development.
The 2.5 million sq. ft project, located within the Hebbal micro-market in the city’s northern part, is expected to be completed in three years.
The investment has been made from Godrej Fund Management’s $450 million office investment and development platform. The fund, Godrej Build to Core-1, has received commitments of around $150 million from Allianz Real Estate and another $150 million from Dutch investor APF Asset Management. Read more>>
Allianz, Gaw Secure S$945m Green Loan for Duo deal from UOB, DBS, StanChart
United Overseas Bank (UOB), DBS Bank and Standard Chartered Bank (Singapore) have teamed up to extend a S$945 million ($698 million) green loan to Allianz Real Estate and Hong Kong private equity firm Gaw Capital Partners.
The syndicated loan will finance Allianz’s and Gaw’s S$1.575 billion joint acquisition of Duo Tower and Duo Galleria from M+S, the national joint venture between Malaysia and Singapore. Read more>>
Singapore’s Keppel Land Buys 49% of Mumbai Area Project for $57.8M
Singapore-based diversified conglomerate Keppel Corporation’s property arm Keppel Land has entered into a joint venture with realty developer Rustomjee Group to develop an integrated township project spread over 127 acre in Thane near Mumbai.
Keppel Land will be acquiring 49% stake in the joint venture company Kapstone Constructions for around Rs 410 crore. This is first such alliance between a Singaporean and an Indian developer for any project in Mumbai Metropolitan Region. Read more>>
China Home Price Growth Slowest in Nearly 3 Years
China’s new home prices grew at their weakest pace in nearly three years in November, with tightening policies continuing to cool the market even as some easing is expected to prevent a sharp slowdown.
Average new home prices in China’s 70 major cities rose 0.3 percent in November from the previous month, lower than growth reported in October and marking the weakest growth since February 2018, Reuters calculated from official National Bureau of Statistics (NBS) data. Read more>>
Investment in Hong Kong’s Industrial Property Halves
Investment in Hong Kong’s logistics and industrial property declined by more than half in the third quarter of the year, as a period of worsening social unrest crimped domestic consumption and dampened sentiment.
Data from Real Capital Analytics, which tracks deals worth at least $10 million, show that investment in industrial buildings came to $719.9 million, down by 51.6 percent from the roughly $1.5 billion invested in the segment in the same period of 2018. Read more>>
Chinese Home Builders’ Favourite Funding Ploy Is Under Threat
The favored funding source of China’s real-estate developers is under scrutiny in one of the country’s largest urban areas, posing a threat to a sector that has stretched creative financing to its limits.
On Friday, the city of Xi’an in central China opened a consultation process on instituting an escrow system that would ensure developers hold on to funds worth 1.2 times the cost of building a new property when booking a presale. There is no existing escrow system of this kind in China. Read more>>
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