Aging industrial buildings continue to be hot property in Hong Kong, as a former workshop in the New Territories changed hands recently for HK$258 million ($33 million).
According to information released last week by the city’s Lands Department, the Mantex Industrial Building at 37-43 Sha Tsui Road in Tsuen Wan has been purchased by Pioneering Realty Development Ltd (盈峰建業有限公司) for a price equivalent to HK$1,939 per square foot.
The transaction was the first in thirty years for the 14,000 square foot, three-storey building. The previous owners, who had purchased the building in 1987 for HK$13.5 million, achieved an 18 times return on their original investment.
Policy Move Sparks Industrial Surge
Hong Kong’s Secretary for Development Michael Wong Wai-lun announced in August that the city government was considering relaunching a program to encourage the redevelopment of underused industrial facilities.
In response to the potential policy initiative, investors have shown increased interest in the asset class, and are buying up warehouses and factories around the city. Earlier this month, the 23-storey Wong’s Factory Building in Tsuen Wan sold for HK$1.23 billion ($157.5 million) – appreciating nearly 81,000 percent over the past 45 years.