Mingtiandi

Asia real estate and outbound investment news

  • Facebook
  • LinkedIn
  • RSS
  • Twitter
Sign Up / Login Logout

Lost your password?
Register
Forgotten Password
Cancel

Register For This Site

A password will be e-mailed to you.

  • Capital Markets
  • Events
    • 2021 Mingtiandi Event Calendar
    • Join the Mingtiandi Multi-Family Investment Forum 2021
    • Join the Mingtiandi Logistics Real Estate Forum 2021
    • Join the Mingtiandi Sustainable Real Estate Forum 2021
    • Join the Mingtiandi Data Centre Forum 2021
    • Join the Mingtiandi Office Strategies Forum 2021
    • Join the Mingtiandi Proptech Forum in November
    • More Events
  • MTD TV
  • People
  • Logistics
  • Asia Outbound
  • Retail
  • Design & Construction
  • Research & Policy
  • Advertise

Phoenix Said Seeking Buyer for Wan Chai Commercial Project at HK$330M

2020/05/12 by James Hatton Leave a Comment

CBRE is marketing the redevelopment project on Johnston Road in Wan Chai

Phoenix Property Investors is seeking a buyer for a commercial redevelopment project in Hong Kong’s Wan Chai district at an asking price of HK$330 million ($43 million), according to people familiar with the matter who spoke to Mingtiandi.

The Hong Kong private equity shop headed by financiers Benjamin Lee and Samuel Chu has put the boutique-sized project at 189 Johnston Road on the market just over one year after completing its acquisition of the 1974-vintage property that occupies the site.

Yardi Refurbish or Rebuild

Located 250 metres from Wan Chai MTR station, the 1,500 square foot (139 square metre) site can yield up to 22,000 square feet of gross floor area, and Mingtiandi has come to understand that that the disposal of the property is not related to Hong Kong’s COVID-19 driven property market woes.

Making Way for a New Tower

Based on the development’s potential GFA, the site could fetch HK$15,000 per square foot if sold at the HK$330 million asking price.

The plot can be developed as either a commercial property of up to 25 storeys in height, a 50-room hotel, or a co-living centre, according to CBRE, which has been appointed as sole marketing agent for the project.

“With the COVID-19 situation under control in Hong Kong and 90 percent of people back at work, this redevelopment opportunity in a core Wan Chai location popular with investors will appeal to small and medium-sized developers as well as co-living operators,” said Reeves Yan, CBRE’s head of capital markets in Hong Kong.

Samuel WT Chu and Benjamin KY Lee

Benjamin Lee (L) and Samuel Chu of Phoenix are said to be seeking a buyer for the Wan Chai site

Noting that strata-title sales of office properties near the Johnston Road project can achieve between HK$25,000 and HK$28,000 per square foot, CBRE’s Yan said that 189 Johnston Road represents a rare opportunity to buy a redevelopment project in an area where new land supply is scarce.

Phoenix Property Investors declined to comment on the proposed sale.

A Short Time on Johnston Road

The real estate investment firm had acquired a majority of the building during 2018 when it bought up ten residential units and a shop in the property just east of Fleming Road for a reported HK$160 million.

By March of last year Phoenix had acquired nearly 94 percent of the space in the building before applying for a compulsory sale to acquire the sole remaining unit at a value of HK$150 million for the whole property. Official records show that compulsory sale application was later withdrawn, with the fund manager said to have completed its acquisition of the remaining unit around April 2019.

Phoenix is said to be continuing to monitor opportunities in the market in the normal course of its fund management process.

Wan Chai Warms Up

Just two stops east of Central – Hong Kong’s most expensive office market – developers have been mining Wan Chai for development opportunities, buying up old commercial buildings which can be demolished to make way for new offices and hotels.

Blue chip Hong Kong developer Henderson Land’s upcoming 65,083 square foot office project at 206-212 Johnston Road, which is due to complete later this year, is just 100 metres west of the Phoenix site, while Sun Hung Kai Properties is developing a 130,000 square foot office tower 500 metres east at 222 to 228 Wan Chai Road.

Smaller property investors are also getting in on the act, with a commercial redevelopment site at 72-76 Queen’s Road East in Wan Chai selling for HK$253 million just over two weeks ago, according to a local media account. Based on its maximum gross floor area of 30,000 square feet, that Wan Chai project changed hands at HK$8,433 per square foot.

That media account had cited market sources indicating that the property, which occupies a 2,014 square foot site, had been acquired by investor Francis Law, although Mingtiandi sources now indicate that the Toyo Mall tycoon was not the buyer.

Despite a slow first quarter, CBRE’s Yan said that leasing enquiries in Wan Chai have picked up in April and May, with some tenants in Central aiming to save money by relocating to the area which, together with Causeway Bay, constitutes the eastern fringe of the island’s core office district,

Grade A office rents in the Wan Chai and Causeway Bay submarket fell by 4.5 percent during the first three months of 2020 compared with the previous quarter, with rental values for premium properties going for an average of HK$115 per square foot per month, according to CBRE.

Office Investment

Exiting Investments

Phoenix is seeking a buyer for the project as the private equity shop settles into divestment mode, including have sold off a pair of properties earlier this year.

In February, the property fund manager disposed of a row of shophouses in Singapore’s Chinatown for S$54 million ($38 million) to Aberdeen Standard Investments. That disposal earned Phoenix and its investors a mark-up of more than 20 percent over the S$42.8 million the firm paid to purchase the heritage properties from Japanese shipping company K-Line in late 2014.

A month before that Singapore deal, the firm had sold an apartment building in Tokyo for JPY 20 billion ($190 million), just 30 months after buying the Shinagawa area property.

Phoenix reached a final close of $1.15 billion on its latest opportunistic real estate fund, Phoenix Asia Real Estate Investment VI, in November last year.

Related Stories

  • SilkRoad Buys Hong Kong Cold Chain Asset for $41MSilkRoad Buys Hong Kong Cold Chain Asset for $41M
  • Causeway Bay Commercial Site Put on the Market for HK$1B in Hong KongCauseway Bay Commercial Site Put on the Market for HK$1B in Hong Kong
  • Kailong to Convert Eight HK Properties into Chain of Boutique OfficesKailong to Convert Eight HK Properties into Chain of Boutique Offices
  • Phoenix Property Investors Said Buying Queen’s Road Office Space For HK$442MPhoenix Property Investors Said Buying Queen’s Road Office Space For HK$442M

Share this now

  • LinkedIn
  • Share
  • Tweet
  • Email

Filed Under: Finance Tagged With: CBRE Group, cm-hk, daily-sp, Featured, highlight, Hong Kong, Johnston Road, Phoenix Property Investors, Wan Chai

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Yardi Refurbish or Rebuild

Get Mingtiandi Delivered

Sustainability Forum

MTD TV

Data Centre Operators Tackle APAC Expansion Challenges in MTD TV Panel

Proptech Forum: Logistics Tech

Logistics Experts Reveal How Tech Is Reshaping Asia’s Distribution Centres

More MTD TV Videos

Latest Stories

Albert Yeung Emperor International

Blackstone Buys Kowloon East Building From Emperor International for $65M

RFR-Vanke Midtown Condominium Project in Manhattan

Vanke Manhattan High-Rise Risks Foreclosure as ICBC Files New York Lawsuit

close to universities like University College London and universities like St Martins College Art and Design

Mapletree Explores US$1B Student Housing REIT IPO and More Asia Real Estate Headlines

Sponsored Features

Tony Horrell

Colliers’ Global Investor Sentiment Report Anticipates Up to 50% Surge in Investment in 2021 Sponsored Feature

Andrew-Slevin-John-Foord (4)

Insurtech to Help Address Underinsurance Across Asian Real Estate Assets in 2021 Sponsored Feature

CK Lau

Asia Pacific Logistics Sector: Increasingly Varied Sector Requires Multiple Approaches Sponsored Feature

More Sponsored Features>>

MTD-QR-Code-320

Top Stories

PGIM Real Estate Buys Office Building on Singapore’s Robinson Road for $107MPGIM Real Estate Buys Office Building on Singapore’s Robinson Road for $107M

APAC Data Centre Demand to Double Within 5 Years Says Knight FrankAPAC Data Centre Demand to Double Within 5 Years Says Knight Frank

APG Buys 20% Stake in Greater China Data Centre Operator OneAsiaAPG Buys 20% Stake in Greater China Data Centre Operator OneAsia


Connect with Mingtiandi

  • Facebook
  • LinkedIn
  • RSS
  • Twitter

Real Estate News

  • Capital Markets
  • Events
    • 2021 Mingtiandi Event Calendar
    • Join the Mingtiandi Multi-Family Investment Forum 2021
    • Join the Mingtiandi Logistics Real Estate Forum 2021
    • Join the Mingtiandi Sustainable Real Estate Forum 2021
    • Join the Mingtiandi Data Centre Forum 2021
    • Join the Mingtiandi Office Strategies Forum 2021
    • Join the Mingtiandi Proptech Forum in November
    • More Events
  • MTD TV
  • People
  • Logistics
  • Asia Outbound
  • Retail
  • Design & Construction
  • Research & Policy
  • Advertise

More Mingtiandi

  • About Mingtiandi
  • Contact Mingtiandi
  • Newsletter Subscription
  • Terms of Use
  • Privacy
  • Advertise
  • Join the Mingtiandi Team