Shared office giant WeWork leads the news again today as Japan’s Softbank decides to wager another $1 billion that leasing offices on a retail basis will continue to be a growth industry. Also in the news, a UK sports retailer has purchased the House of Fraser off the bargain rack after Nanjing’s Sanpower struggled to turn around the department store chain and the latest round of developer results show deals in Hong Kong and Singapore driving profits while the mainland slowdown puts a dent in earnings for Wharf. Read on for all these stories and more.
WeWork has clinched a $1bn investment from Japan’s SoftBank, the latest capital injection into the provider of shared office space as its losses in the first half of 2018 ballooned.
The US company said the investment would lift its existing cash pile and cash commitments to $4bn, money it plans to use for overseas expansion, build office space and acquire new properties and leaseholds, according to an investor presentation seen by the Financial Times. Read more>>
Mike Ashley’s Sports Direct has agreed to buy the House of Fraser department store chain for £90m. The deal was announced just hours after the 169-year-old chain went into administration when talks with its creditors failed to reach an agreement.
Mr Ashley said his plan was to turn the 59-store chain in to the “Harrods of the High Street”. Nanjing-based conglomerate Sanpower had purchased an 89 percent stake in the UK retailer for £450 million in 2014. Read more>>
Wharf Holdings, one of Hong Kong’s biggest landowners, reported a 66 per cent drop in core profit, amid a slowdown in property sales that looks set to continue as Hong Kong and mainland China push ahead with market cooling measures.
Wharf’s chairman and managing director Ng Tin Hoi told a post-earnings press conference that the company had struggled to meet its mainland sales targets and that the market outlook for the second half remained challenging. Read more>>
Swire Properties (1972) said today first half net profit was HK$21.2 billion, from HK$14.7 billion in the first half of 2017. Underlying profit, adjusted for changes in the valuation of investment properties, increased by HK$1.59 billion from HK$4.62 billion in the first half of 2017 to HK$6.21 billion in the first half of 2018.
The company declared a first interim dividend of HK 27 cents compared with 25 cents per share in 2017. Underlying profit increased a result of profit booked from the sale of interests in an office building in Kowloon Bay and in other investment properties in Hong Kong, partly offset by a substantial decrease in profit from property trading. Read more>>
City Developments Limited (CDL) yesterday reported a second-quarter net profit of $204.8 million, up 80 per cent from $114.1 million in the same period a year ago. This came on the back of a 60 per cent increase in revenue for the quarter to $1.36 billion this year, from $854 million in the same period last year.
The increases for the second quarter were due largely to higher gross profit generated by the company’s property development segment, said the property developer. Read more>>
Ho Bee Land has posted net profit of S$71.5 million for the second quarter ended June 30, up 98.1 per cent from the S$36.1 million net profit in the year-ago period.
In a filing with the Singapore Exchange on Friday evening, the property group said that the stronger bottomline was on the back of recognition of a S$28.3 million fair value gain on investment property. This arose from the group completing the sale during the second quarter of 2018, of a 30-year leasehold interest carved out from a 999-year leasehold petrol station site in Bukit Timah Road. Read more>>
Shares of China’s property developers rose on Friday on reports that two state-owned banks in Shanghai have lowered their first-home mortgage rates to ease buying restrictions after two years of controls to cool the overheated market.
Property agents and mainland state media said borrowers would be eligible for a 10 per cent discount off the benchmark interest rate, up from a previous 5 per cent, at the Shanghai branches of the Industrial and Commercial Bank of China and the Agricultural Bank of China from Friday. This means the rate will be lowered to 4.41 per cent from 4.655 per cent, they said. Read more>>
Chinese developers’ appetite for new land has fallen to the lowest level since 2014, following government curbs on runaway home prices and lending, a new report said.
China Securities Co. looked at land sale data of 300 Chinese cities in recent years. It found that in the first seven months of this year, auctions of 258 plots of land failed to find buyers . That is 59 per cent higher than in the same period of 2014, when a record high stockpile of unsold homes led to a nationwide home-price slump. In all of 2014, 345 plots failed to sell. Read more>>