SHK Hotel Business Takes a Beating and More Asia Real Estate Headlines

Hong Kong’s biggest developer by value leads the way in Mingtiandi’s roundup of Asia real estate headlines today with the news that the company’s hotels business took a pounding in the second half of last year, with the group’s chairman warning that there is worse to come.

In other news around the region, China’s securities regulator is launching a probe into a financially strapped conglomerate after it defaulted on a bond payment, while commercial property transactions in February fell to an historic low in Hong Kong. The bad news in Hong Kong comes as a new report shows that residential rents in the city’s competitor to the south hit a three-year high.

Sun Hung Kai’s Hotels Business Takes a Beating

Sun Hung Kai Properties, the biggest Hong Kong developer by value, warned of a bleak outlook for the hospitality and retail sectors after its hotel business took a pounding in the second half of last year.

The company’s hotel operating profit plummeted by HK$595 million ($76 million), or 75.1 percent, to HK$197 million, with a significant drop in revenue per available room as social unrest led to a severe decline in visitor arrivals. Its other businesses, from retail to telecoms and logistics, were also hit badly. Read more>>

HNA to be Investigated Over RMB 1.5B Bond Default

China’s securities regulator will launch a probe into complaints filed by investors about the way HNA Group handled a privately issued bond it defaulted last year, according to people familiar with the matter.

According to their complaints to the China Securities Regulatory Commission, the Chinese conglomerate has yet to repay its RMB 1.5 billion ($214 million) bond that came due in late July, they said. Read more>>

Coronavirus Drags Commercial Property Transactions to All-time Low

Hong Kong’s commercial property market, already reeling from last year’s protests, is about to slide further into the doldrums as the coronavirus epidemic saps demand, according to analysts.

The volume of transactions for office, retail and industrial properties is poised for a historic low in February, having already sunk to record levels in the previous two months. Meanwhile, a grade-A office building near Central has seen its rent plummet by two thirds to HK$42 ($5.4) per square foot, the lowest in ten years. Read more>>

Nan Fung Life Sciences Unit Buys Boston Office Property for $115M

Nan Fung Life Sciences Real Estate bought 51 Sleeper on 24 January for $115 million, according to Suffolk County land records and a corporate database search with the Secretary of the Commonwealth’s office.

Brookfield acquired the eight-story, 152K SF building at the end of 2018 for $91 million. Read more>>

Rents in Singapore Hit 3-year High as Expat Demand Surges

Residential rents in Singapore rose to a three-year high in 2019, with prices boosted by strong overseas demand that signals the city-state’s continuing appeal among expatriates.

Rents climbed 1.4 percent last year, according to real estate agency OrangeTee & Tie, using data from the Urban Redevelopment Authority. Read more>>

South Korean Conglomerate to Select Lead Manager for Asset Sale

Hanjin Group, an airline-focused South Korean conglomerate, said it will select a lead manager in the coming months for the sale of non-core assets to improve its financial status.

Hanjin Group has sent requests for proposals (RFPs) to 12 real estate consulting firms, accounting firms, brokerages, asset management firms and trust companies, asking them to submit their proposals for the asset sale by March 24, the company said in a statement. Read more>>

Lodha’s UK Arm Eyes $225M from Bonds

Indian real estate developer Lodha Group’s UK subsidiary plans to raise $225 million by selling bonds to refinance a part of its debt.

The proceeds of the sale will be used to refinance a part of its outstanding $324 million senior notes that will mature on 13 March, the Mumbai-based developer said. Read more>>

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