
Payson Cha’s Hanison is said to be picking up 69 Jervois Street from Kingboard
A 32-storey commercial building in Hong Kong’s Sheung Wan area is on the verge of being sold for HK$1.9 billion ($242 million) according to local media reports this week, despite the city’s office market during the first quarter of 2019 having recorded less than one fifth of the deal volume of the same period last year.
The suitor for the Tung Seng Commercial Building, just one metro station west of the city’s Central business hub, is said to be Payson Cha-controlled Hanison Construction, according to market sources who spoke with Mingtiandi.
The potential sale of the asset, which is also known as 69 Jervois Street, comes after Hong Kong-listed Kingboard Holdings is said to have retained Savills to market the grade B office asset five blocks inland from the Macau ferry terminal.
At the time of going to press, neither Hanison Construction nor Kingboard had made a statement regarding a potential transaction for the property.
Revamps Still Big Business for Hanison
The reported offer by redevelopment-specialist Hanison, which is controlled by the same Cha family who own a majority stake in developer Hong Kong Resort International (HKRI), shows that the developer’s interest in revamping ageing buildings in the city has not cooled.

20 year-old HK tower falls into new hands
Built in 1999, 69 Jervois Street has a gross floor area of 103,376 square feet (31,509 square metres) and is currently 100 percent occupied by tenants including healthcare technology and biometrics companies, at an average price per square foot of HK$40. In addition to the office space, the ground floor of the building is home to a vegetarian restaurant, with the first through fifth storeys used as a car park.
Head of Hong Kong research at Cushman and Wakefield, Reed Hatcher, stated that the average price per square foot of gross floor area for Grade A office assets in the Sheung Wan area is currently HK$37,491, while average rents for those properties stand at HK$75.9 per square foot per month in the neighbourhood. Average rents across Hong Kong’s grade A office market contracted by 0.3 percent month on month in January, according to agency data.
Hong Kong stock exchange-listed Kingboard had put 69 Jervois Street up for tender at a reserve price of HK$1.5 billion in 2015 without ultimately concluding a sale. The twenty year-old property was previously owned by property developer Nan Fung, before being sold on to Kingboard in 2010 for HK$650 million.
Hanison Strengthens HK Property Portfolio
Hanison is a veteran of Sheung Wan building trades, having bought up the entire 25-storey Ovolo Sheung Wan serviced apartment building on Queen’s Road in the district for HK$506 million in January 2018. In May of that year, the developer sold a Sheung Wan commercial building jointly owned with Angelo, Gordon and Co for HK$1.1 billion after operating it as a serviced apartment business.
Despite the gyrations in Hong Kong’s real estate markets in the past year, the developer has not stopped trading assets in the territory. In October last year, Hanison purchased a serviced apartment building one MTR stop west of Sheung Wan in Sai Ying Pun from Singapore’s CapitaLand for HK$730 million. Then in June 2018 the developer offloaded a 50 percent stake in an office building in Cheung Sha Wan to private equity firm PAG for HK$800 million.
Other properties to feature in Hanison’s 2018 shopping spree included the Central Industrial Building, located in the Kwai Chung area of the New Territories, purchased for HK$720 million, and four floors of the San Po Kong building in New Kowloon with an area of 7,762 square feet (721 square metres) which were sold to a Hanison affiliate for HK$258 million each.
Reed Hatcher, Head of Research at Cushman and Wakefield in Hong Kong, commented that preliminary data on the Hong Kong commercial investment market in the first quarter suggests that sentiment remains weak, with just 14 commercial property transactions of at least HK$100 million recorded during the period for a turnover of HK$4.93 billion.
“In terms of total volume, that represents a drop of 78.9 percent quarter on quarter and 86.6 percent year on year,” the analyst noted.
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