PAG and Mapletree Investments said Thursday that they have agreed to form a joint venture to acquire Hong Kong’s Goldin Financial Global Centre from the property’s receivers for HK$5.6 billion ($713 million), confirming a Mingtiandi report from last month.
The 50:50 JV of Hong Kong-based private equity shop PAG and Singapore’s Mapletree will take charge of the Grade A office building after a series of failed tenders and cancelled sales over the past two years. Situated in Kowloon East, an area positioned as the city’s second central business district, the 28-storey tower comprises 886,703 square feet (82,377 square metres) of total lettable area and boasts LEED Platinum and BEAM Plus Platinum green certifications.
PAG president Jon-Paul Toppino touted the acquisition as a “very good value” and a significant discount to replacement cost. The deal prices the property at around 18 percent less than the HK$6.8 billion in debt Goldin Financial had secured with the asset, with the failure to meet that obligation having led to the property being seized by receivers in July 2020.
“This transaction further expands PAG Real Assets’ footprint in Hong Kong, where we see the ongoing post-COVID recovery creating attractive opportunities for us and our investors,” Toppino said in a release.
Finale Inches Closer
The latest chapter in the long-running saga comes after the receivers terminated a September deal to sell the Goldin Financial Global Centre for HK$6.7 billion after the transaction failed to complete.
The joint venture’s agreed price values the building at HK$6,316 ($809) per square foot of total lettable area, or about 16 percent less than the HK$6.7 billion deal agreed to in September with erstwhile buyer HG Real Estate Investment Hong Kong Co Ltd.
HG filed a lawsuit in November claiming that the sale and purchase agreement had been terminated without cause. Representatives of the receivers did not respond to inquiries from Mingtiandi regarding the case.
Wong Mun Hoong, regional CEO for Australia and North Asia at Mapletree Investments, said the Temasek Holdings-owned firm seized an opportunity to boost its presence in Hong Kong, where Mapletree has S$7.5 billion ($5.6 billion) in assets under management across the logistics, office, retail and data centre sectors.
“With the reopening of the border with China and the easing of travel restrictions, we are confident of the recovery of the office sector in Hong Kong,” Wong said.
Confidence in Kowloon East
The Goldin buy marks the second time that PAG and Mapletree have worked together on a deal involving a Kowloon East office property, following the Hong Kong firm’s nearly HK$9 billion purchase of what was then known as Mapletree Bay Point in 2019.
That property, which was developed by Mapletree on a site 2.2 kilometres (1.4 miles) southeast of the Goldin Financial Global Centre, won Manulife as a tenant in 2021 and was renamed Manulife Place after the Canadian insurer agreed to lease 145,000 square feet in the tower.
PAG Real Assets, the real estate business of PAG, has more than $10 billion in equity under management across Asia Pacific after acquiring and managing over 7,000 properties in the past two decades.