The sixth floor of the On Lok Yuen Building on Hong Kong’s Dex Voeux Road was purchased by a Macau investor for HK$100 million, the Land Registry announced late last month. The investor has now been identified as Chan Wai Leng, wife of Macau gambling titan and reputed one-time triad member, Chau Cheok Wa.
The commercial space had been leased by Chan for her fitness centre business since last year, and the wife of the gambling kingpin is believed to have purchased the floor for her business operations, an account from Hong Kong Economic Times indicated.
The purchase of the commercial asset in the On Lok Yuen building, which sits next to Worldwide House between Des Voeux and Connaught Roads in Central comes out to HK$26,000 per square foot. The transaction allowed the seller, Gale Well Group, to triple the HK$8,480 per square foot that it had paid to acquire the property three years ago for HK$43.5 million, according to transaction data from Spacious.com.
Local Investor Makes HK$56.5M in Three Years
The acquisition by Chan provides Gale Well Group — a real estate investment firm founded by Jacinto Tong Man Leung, with a HK$ 56.5 million increase in the value of the building since its purchase. The group had bought eight and a half floors in the 1961-vintage building three years ago for HK$357 million.
Gale Well founder and managing director Jacinto Tong Man Leung told local media that the company’s investment strategy is to get rid of “underperforming assets”.
“There are properties underperforming because of aging or yields affected by the changing environment in the project’s nearby area. We will single out these underperforming assets and dispose of them in a buoyant market. These assets can still fetch good prices in a robust market,” Tong told the SCMP in an interview in 2016.
The 14-storey commercial building located at 25-27 Des Voeux Road Central is only two minutes walk away from the Central MTR station. The third floor of On Lok Yuen sold for HK$76 million in 2017 and rental rates in the building average around HK$37-45 per square foot.
Car Park Queen Cashes in on Commercial Portfolio
Gale Well Group is best known for the parking preference of its president, Rita Tong Liu, also known as the car-park queen. Liu, who is estimated to have built a fortune of $3.4 billion and is ranked as Hong Kong’s fourth-richest woman by Forbes, began investing in car parking spaces in the early 1970s and now Gale Well Group mainly engages in sale and leasing of residential, commercial, office and industrial properties.
The company decided to move into commercial office space in 2003, with a focus on grade-A offices. The group’s stable includes entire floors in Grand Millenium Plaza on Queen’s Road, the Shun Tak Centre on Connaught Road, and the Far East Financial Centre, Lippo Centre and Admiralty Centre in Admiralty.
Industry analysts are expecting a surge in office rental rates in Hong Kong during the fourth quarter, according to real estate consultancies active in the city. While the rental performance of office space in Central stayed firm, Wan Chai and Causeway Bay achieved the fastest growth in rental rates during the quarter, according to the most recent office market report from Colliers International.