WeWork Annual Loss Doubles to $2B and More Asia Real Estate Headlines

New data is now available on the arc of the global shared office phenomena and WeWork’s announcement this week that its annual loss doubled to $2 billion in 2018 has analysts wondering if the co-working craze has already passed its apogee.

Also in the news today, Singapore’s Ascott REIT has added a Sydney hotel to its Aussie portfolio and Fujian-based developer Tahoe Group has sold a third project to Shimao Propertie ahead of a bond maturing today. Read on for all these stories and more in Mingtiandi’s Asia real estate news roundup.

WeWork Burn Rate Hits a Blazing $2B in 2018

WeWork Cos. on Monday said its loss last year doubled to nearly $2 billion, as the nine-year-old company spent heavily in an effort to rapidly expand its network of shared offices around the world.

The New York-based company’s revenue more than doubled to $1.82 billion, mostly from leasing office space. But heavy expansion costs led to a loss of $1.93 billion. Read more>>

Ascott REIT Buys Sydney Hotel for A$60M

Ascott Residence Trust (Ascott Reit) is buying a 150-room business hotel near Sydney Airport for A$60.6 million (S$58 million), it announced yesterday.

The freehold Felix Hotel will be rebranded as Citadines Connect Sydney Airport upon completion of the deal in May. The acquisition will be the trust’s first business hotel in Australia and its first property to be managed by its sponsor, The Ascott Ltd, under the new Citadines Connect brand. Read more>>

Tahoe Sells Third Project Stake to Shimao Within One Week

Facing a Thursday deadline to repay a RMB 3 billion bond, Shenzhen-listed developer Tahoe Group announced on March 27^th that it had sold a 40 percent stake in a Fujian real estate project to Shimao Group for an equity consideration of RMB 54 million.

The transaction, which is Shimao’s third acquisition of a stake in a Tahoe project within the last week, also involves the developer controlled by billionaire Xu Rongmao taking over responsibility for a prorated portion shareholder loans to the 500,000 square metre project in the Fujian province city of Zhangzhou. Read more>>

Singapore’s URA Issues New Rules to Encourage Redevelopment of Aging Offices

Singapore’s Urban Redevelopment Authority (URA) will offer an increase in gross plot ratio for areas within Singapore’s Central Business District (CBD) to encourage the conversion of existing office developments to hotel and residential uses, Minister for National Development Lawrence Wong said on Wednesday (March 27).

That change will fall under a new CBD Incentive Scheme that is part of a broader plan to boost the live-in population within the city’s central area, with a variety of homes and amenities in places such as Downtown, Marina South and Rochor to enable more people to leave near workplaces and amenities. Read more>>

China Resources Land Grew Land Bank by 60% in 2018

China Resources Land Limited, a subsidiary of the central government-administered China Resources (Holdings) Company Limited, saw its land bank grow by nearly 60% from 37.44 million square meters to 59.57 million square meters in 2018, according to an annual performance report released Tuesday.

The land bank expansion cost Hong Kong-listed China Resources Land a total of 151.35 billion yuan ($22.54 billion) last year across multiple projects. Tang Yong, chairman of the board at China Resources Land, said the company’s land bank can now support its next three years of development. Read more>>

Chinachem’s Sol City Project Fails to Woo HK Buyers Despite Discounts

Home sales at Hong Kong property developer Chinachem Group’s Sol City development in Yuen Long got off to a slow start on Tuesday, and only a fifth of the 148 units on offer were sold. The lacklustre sales, which started at 6pm local time, added to evidence that a correction in Hong Kong’s property market is far from over.

Twenty-nine apartments were sold, with most buyers seeking one-bedroom units, said Sammy Po Siu-ming, the chief executive of Midland Realty’s residential division, the project’s sales agent. Read more>>

Blockchain App Helps Yanlord Land Sell Out Suzhou Project

Real estate developer Yanlord Land Group said on Wednesday that it has fully sold out on the first day of its latest launch of apartment units at Riverbay Gardens in Suzhou, China to garner over 1.155 billion yuan (S$233 million).

All 193 apartment units available during the first day of sales on March 26 were sold out, with an average selling price of 35,300 yuan per square metre for the 32,745 sq m gross floor area sold.

Sales were done through a blockchain-driven public balloting system which shortlisted buyers and enabled them to select units simultaneously, said the group. Read more>>

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