Both a Hong Kong and a mainland China property company are reporting good news today, with New World Development recording a 29 percent hike in core profit over a six month period, while Dalian Wanda successfully floated a $300 million bond issue in the international markets. Also in the news, the struggle to keep achieving financial goals in now driving mainland builders to focus on acquiring old buildings in the city for redevelopment, and there are still more stories awaiting you in Mingtiandi’s roundup of news from around the region.
New World Development, Hong Kong’s fourth-largest developer by value, posted the biggest jump in interim earnings in two years, propelled by rising home sales in the first half of its financial year, as it cleared unsold property off its books before a proposed vacancy tax takes effect.
The developer’s core profit, excluding revaluation gains on investment properties, rose 29 percent to HK$5.4 billion ($687.49 million) in its first half ended December, according to a statement to the Hong Kong Stock Exchange. Sales soared 76 percent to HK$49.27 billion, beating the HK$34.91 billion consensus in a Bloomberg survey of analysts. Read more>>
Dalian Wanda Commercial Management Group shook off its recent past and returned to the international markets for a $300 million bond issue that was more than four times subscribed, boosted by a rally in Asia’s high-yield market.
The Ba1/BB/BB+ rated Chinese real estate company priced the 6.25 percent 363-day senior unsecured notes yesterday at 100.001, inside initial guidance in the area of 6.50 percent. The Reg S unrated issue was Wanda’s first public deal in the offshore bond market in five years, and showed that investors have regained at least some confidence in the company following years of deleveraging. Read more>>
Singapore’s JTC has launched a tender for a site at Tampines North Drive 3 (Plot 2) under the first half of the 2019 Industrial Government Land Sales (IGLS) programme, it said on Tuesday (Feb 26). The land parcel spans 0.48 hectares and has a gross plot ratio of 2.5 and a tenure of 20 years.
The site is zoned B2, which means the site may be used by heavy industries that have a greater environmental impact. As the second of five Confirmed List sites for the first half of the 2019 IGLS programme, the launch of the site is part of the Singapore government’s efforts to offer more choices for industrial development, said JTC. Read more>>
Grade A office rents in Singapore’s Central Business District (CBD) edged up 9.5 percent year on year in 2018 amidst a supply crunch and higher vacancy rate, according to a report by Savills Research. The strong rental growth was led by the grade AAA office sector, which rose 4.8 percent quarter on quarter in the last three months of 2018 and 16.3 percent year on year, and the Grade AA office sector, which grew 3.2 percent quarter on quarter and 11.8 percent year on year.
In the fourth quarter, the Marina Bay area reportedly saw the largest rental increase on a quarterly basis at 4.8 percent, followed by Raffles Place (3.5 percent) and Tanjong Pagar (3.2 percent). In 2018, the top three micro-markets enjoying the strongest rental growth were Marina Bay (17.1 percent), Shenton Way (10.7 percent), and Tanjong Pagar (10.5 percent). Read more>>
Odyssey Asset Management Ltd, a sister company of alternative asset manager Odyssey Capital, has announced the first close of its Japan-focused private equity real estate fund – Odyssey Japan Boutique Hospitality Fund – with aggregate commitments of $200 million.
The fund, launched in June 2018 to focus on the acquisition of boutique hospitality assets throughout Japan, achieved the first close at the end of January. It bagged commitments from high net-worth individuals, family offices, and large financial institutions across the Asia Pacific region. Read more>>
Mainland Chinese builders appear to be shifting their Hong Kong land bank strategy by acquiring old buildings for redevelopment, as fierce competition and Beijing’s capital outflow restrictions make it difficult to secure plots in government tenders.
Last year, developers from the mainland submitted 39 compulsory en-bloc sale applications to Hong Kong’s Lands Tribunal, up 160 percent from 2017, according to JLL’s Residential Sales Market Monitor released on Tuesday. Read more>>
The US-China trade war, volatile equity markets, geopolitical tensions and uncertain pace of future interest rate increases are among factors that will hold back investors from the hotels sector this year, according to a JLL report.
However in the run-up to two major events soon to be hosted in Tokyo, Japan stands to remain something of an exception. Japan, which was the top market for hotel deals last year, is expected to lead the region again this year on the back of the Rugby World Cup and the Tokyo 2020 Summer Olympic Games. Read more>>