Hong Kong Tycoon’s Heirs Marketing Offices in The Center at 43% Off

Heirs to the fortune of Hong Kong’s late “Minibus King” have dropped their price for two units in The Center, marking a record low for what was once Hong Kong’s most expensive office building.

Two units on the 27th floor of the Queen’s Road Central office tower are being marketed at HK$18,800 ($2,424) per square foot, according to a release by agent Centaline Property, which termed the deal a ‘limited time offer.’ Public records show that the assets belong to the family of Ma Ah-muk, who built a multibillion-dollar property empire off the back of Hong Kong’s biggest fleet of minibuses before passing away n March last year.

The price is a 14 percent discount from when the units were previously put up for sale in February and 43 percent below what Ma and a consortium of investors paid to acquire the building from Hong Kong’s richest man, Li Ka-shing, in 2017.

The owners’ willingness to offer limited-time discounts “clearly shows their sincere intention to sell”, said Centaline’s Salome Mak.

Ma’s family continue to liquidate assets from their portfolio, as declining rents and rising vacancy undermine Hong Kong’s commercial market. Average office rents were 42.2 percent down from their 2019 peak in the first quarter, according to Cushman & Wakefield, which expects prices to drop as much as 9 percent this year amid continuing oversupply and economic uncertainty.

Cutting Losses

In addition to the two units in the latest promotion, the Ma family is also marketing the 45th floor, which has been divided into six units, and another five units on the 27th floor, according to Centaline.

Guangdong-born Ma had ended up with 13 of the 47 floors acquired by the Center consortium when they bought 75 percent of the skyscraper from Li Ka-shing’s CK Asset in a HK$40.2 billion deal. With the investors having paid CK Asset an average of HK$33,000 per square foot, that deal is now seen as representing the market peak.

The consortium, which included Hong Kong’s “King of Cassettes” David Chan Ping-chi, Shimao Group founder Hui Wing Mau, logistics tycoon Johnny Cheung Shun-yee, and Hong Kong businesswoman Pollyanna Chu, had high hopes for flipping their purchase into sets of smaller, higher value sales after the top floor of Hong Kong’s fifth tallest building had sold for HK$55,854 per square foot in September of 2017 – which remains a record high.

Ma, who had amassed a portfolio of commercial properties estimated in 2018 to be worth $3.8 billion, began liquidating assets in late 2019 as political unrest triggered a slump in Hong Kong’s commercial property market that worsened through the pandemic.

In 2021, Ma sold the 20th floor of The Center for around three-quarters of what he paid. Last November, the family sold two units on the 27th floor for HK$104 million, or about HK$20,500 per square foot, to a Malaysian investor.

The family is in good company, as Shimao’s Hui Ying Mao and Kaiser Group Holdings are also seeking to offload their assets in The Center. Both mainland Chinese companies have been mired in debt.

Hui is asking HK$559 million, or HK$22,000 per square foot, for the tower’s 37th floor, according to a release by agent Centaline last month.

Kaiser started marketing the 30th floor of the skyscraper last November, seeking just under HK$500 million, or about HK$20,000 per square foot, after having purchased the asset in 2019 for HK$884 million.

Motivated Seller

Other asset sales by Ma and his family since 2020 include a Tsim Sha Tsui commercial building, a Kwun Tong industrial block, and a floor in the China Merchants Tower  of Sheung Wan’s Shun Tak Centre, as well as various street shops and car parks across the city.

Still on the market is the Ma family’s Eco Tree Hotel at 160 Des Voeux Road West in the city’s Sai Ying Pun area, with local media reports from last November saying the family had rejected an investor’s offer of HK$450 million for the budget hostelry.

Ma’s portfolio also includes the Ka Fuk Shopping Centre in Fanling, the Shek Yam Shopping Centre in Kwai Chung, and the Kwai Hing Shopping Center in Kwai Chung, which were acquired from HKEX-listed Link REIT, as well as a residential and commercial block at 60-62 Yee Wo Street in Causeway Bay.