Guangzhou-based China Aoyuan Property Group is expanding its portfolio in Hong Kong by snapping up an industrial building in the New Territories logistics hub of Kwai Chung for HK$950 million ($121 million).
The mid-sized mainland developer is buying the 12-storey building near the intersection of Castle Peak Road and Cheung Wing Road in the rapidly commercialising industrial area from Great Plan Global Limited, a filing posted on the Hong Kong Stock Exchange last Friday shows. The seller, a British Virgin Islands incorporated company, is identified by local media as a unit of textile company Lawsgroup.
Textile Company Makes 50% Return Following Renovations
After purchasing the 1973-vintage Nan Sing Industrial Building at 57-59 Kwok Shui Road from Southeast Asia Properties & Finance for HK$382 million in 2014, Lawsgroup revitalised the industrial building and renamed it as Lot 46. Lawsgroup’s renovation work, which was competed in 2017, included adding another two storeys to the former 10-storey building, which now has a total floor area of 117,233 square feet (10,891 square metres). The still vacant asset also includes a two-storey car park and is 10 minutes walk from the Kwai Hing MTR station.
“The acquisition will provide opportunities for the group to expand property portfolio and develop its property development business in Hong Kong,” the company said in the statement. “It is expected that the development of the target property will bring synergies to the group’s property development business, and thereby expanding the group’s operating income.”
Guangzhou Developer Eyeing Hong Kong
Ranked as the 40th largest developer in China in terms of sales, China Aoyuan began its foray into Hong Kong’s red hot real estate market in March this year by acquiring a set of residential units in the Mid-Levels, just uphill from Central.
The mainland developer purchased three apartments in the 32-unit Yin Yee Mansion at 63-67 Robinson Rd, in the Mid-Levels for a combined HK$80 million. The developer was said to have paid 60 percent higher than market level for the units in the eight-storey residential block built in 1967.
In addition to acquiring condominiums, China Aoyuan also has an appetite for land parcels in the city. Last July, the Guangzhou-based developer submitted a bid during a tender for the residential plot Sha Tin Town Lot No. 611 at Whitehead in the Sha Tin area. The site was eventually won by Hong Kong builder Sino Land for HK$1.38 billion.
Founded in 1996 by Guo Zi Wen, China Aoyuan Property engages in residential and commercial property development across mainland cities including Guangzhou, Beijing, Chongqing and Chengdu. Outside of China, it has four residential projects in Sydney, its corporate website shows.