Hong Kong’s MTR Faces Shortfall on Property Slump and More Asia Real Estate Headlines

Hong Kong’s MTR Corp leads the Friday edition of our headline roundup, as the transit-oriented developer seeks to plug budget holes with measures that could include asset sales. Also making news, a Chinese AI firm reduces its Singapore office footprint and Frasers Hospitality Trust’s SGX-listed units experience a mysterious price surge.

Hong Kong Real Estate Slump Forcing Rejig of MTR Budget

Hong Kong’s MTR Corp is considering raising funds through bond sales, among other options, to help bridge a projected shortfall in its spending needs over the next decade amid a slump in the city’s real estate market, according to a local media report.

The developer and rail operator needs to spend at least HK$160 billion ($20.6 billion) over the next 10 to 12 years, Hong Kong-based Ming Pao reported Friday, citing an unidentified company source. In addition to issuing bonds, MTR is also considering selling or refinancing its shopping malls and other assets. Read more>>

Chinese AI Firm SenseTime Cutting Singapore Office Space

SenseTime Group is reducing its office footprint in Singapore, scaling back once-lofty ambitions at a time when it’s struggling to compete in the post-ChatGPT era.

The Chinese AI pioneer is moving from a prime downtown location to a smaller office in a less expensive neighbourhood, people familiar with the matter said. The company is giving up a roughly 11,000 square foot (1,022 square metre) space in Frasers Tower for a less central building, the people said, asking to remain unidentified discussing private decisions. Read more>>

Frasers Hospitality Trust Surges 40% in Single Month

Frasers Hospitality Trust’s stapled securities have surged about 40 percent in one month. They were trading at S$0.42 on 29 November 2024 and rose to S$0.59 on 31 December — a 40.4 percent jump. The securities last traded on Friday at S$0.55 ($0.40).

Trading volume also jumped, going from 321,000 units traded on 29 November to a high of 14.17 million units on 6 December. In a filing to the Singapore Exchange on 31 December, the manager of the group, Frasers Hospitality Asset Management, said it had noted the “significant” movements in the price and trading volume of the stapled securities. Read more>>

Keppel DC REIT to Sell ‘Distressed’ Asset in Malaysia

Singapore-listed Keppel DC REIT announced Thursday that it had agreed to sell the Basis Bay Data Centre in Malaysia’s Cyberjaya.

The decision to divest came despite earlier assurances that the REIT would work to improve occupancy at the property, which its manager once described as a “distressed” asset. Read more>>

Rising Home Sales Kindle Hope for China Housing Market

Mainland Chinese developers’ hopes for a better start to the new year received a boost as home sales picked up towards the end of 2024, following Chinese authorities’ pledge to “stop prices from sinking further”.

Across 30 major mainland cities, average home sales jumped 86 percent in the fourth quarter from the previous three-month period, according to data from China Real Estate Information Corp. Read more>>

Japanese Home Sizes Shrink to 30-Year Low

Houses in Japan are getting smaller, with the average floor space falling to a 30-year low. Total area per house is about 92 square metres (990 square feet), a decline of 3 square metres from the peak year of 2003, according to the latest government survey, conducted in 2023.

One of the main reasons for the shrinkage is rising construction costs. Builders are designing smaller homes to hold sticker prices down and maintain their profit margins, which amounts to a “stealth price hike”. Analysts warn that young people may hesitate to marry and have children if houses are too cramped. Read more>>

Alibaba-Backed Homestay Manager Xiaozhu Launches in Japan

Xiaozhu Homestay, a Chinese short-term rental platform backed by Alibaba, held a launch event at Egg Japan in Tokyo’s Chiyoda ward to announce the start of its overseas direct homestay operations. In collaboration with Sozonext, a prominent Japanese homestay management company, Xiaozhu unveiled a new accommodation management project branded as Akatsuki.

Akatsuki is a co-developed project by Xiaozhu Homestay and Sozonext aimed at revitalising Japan’s accommodation real estate market. The project focuses on repurposing and renovating ageing buildings to inject new energy into regional tourism. Read more>>

Hong Kong Developer Launches Residential Units at 38% Below 2023 Pricing

A developer is relaunching several residential units at a high-rise project on Hong Kong Island at prices below the levels set about two years ago, suggesting the city’s property market will need at least six more months to overcome excess supply and halt a three-year slump.

Hip Shing Hong is taking orders for 50 units at Oria in Shau Kei Wan after an attempted sale in June 2023. The mid-sized private developer is cutting the prices on 30 of the units by more than 30 percent, according to its revised list published Thursday. Read more>>

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