In Hong Kong’s biggest en-bloc industrial transaction this year, local property firm Stan Group has sold the East Asia Industrial Building (Phase One) in the New Territories for HK$2.24 billion ($290 million).
The asset sale is the fourth in less than two months by parties connected to the family of late “Shop King” Tang Shing-bor, as they look to raise cash after the COVID-19 pandemic and legal troubles dealt multiple blows to their retail and hospitality empire.
The 15-storey building at 2 Ho Tin Street in Tuen Mun, leased to a logistics company, has a gross floor area of 466,449 square feet (43,335 square metres). The buyer, which market sources identified as a unit of mainland conglomerate China Resources, paid HK$4,802 ($618) per square foot of GFA.
The Tang family had gradually acquired ownership of the building, buying stakes from industrial developer Goodman in 2012 and a Cathay Pacific Airways subsidiary in 2016, before selling at “a profit of some HK$1.3 billion”, according to Tony Ng, senior director for capital markets at CBRE Hong Kong, which advised on the sale.
Liquidation in Full Swing
The Tang family’s real estate portfolio was valued at about HK$75 billion last year, Bloomberg reported. Tang Shing-bor, who died in May at age 88, had amassed the fortune by snapping up decrepit industrial properties and transforming them into commercial assets in gentrifying areas of Hong Kong.
But a detour into hotels under Stan Group, led by youngest son Stan Tang, followed by the retail downturn amid civil unrest and the pandemic, had put the mogul on the back foot in his final months.
A fire sale of family held properties kicked into high gear in recent weeks. In mid-June, local media reported that the Tangs had sold a 97 percent interest in a project at 3-13 Nga Tsin Long Road in Kowloon City to Sino-Ocean Group for HK$600 million.
In late June, property consultancy Savills announced that the family had sold On Yam Shopping Centre and its carpark and Shek Wai Kok Commercial Centre and its carpark for HK$1.3 billion. The Tangs had acquired the two Kwai Chung shopping centres through Savills back in 2016 from Link REIT, and the properties were sold at a premium in the latest transaction, the agency said.
Earlier this month, Savills announced that it had facilitated the HK$300 million sale of the first and second floors of Jade Mansion in Yau Ma Tei on the family’s behalf, noting that the deal was one of four transactions recently facilitated and closed by Savills for the family, collectively totalling HK$2 billion.
A Year to Forget
As the COVID crisis left the city without guests to pay for hotel rooms in his son’s hostelries, the elder Tang last year began putting up for sale an estimated HK$6.5 billion in properties, including assets acquired less than a year earlier.
The Shop King then hit a patch of legal trouble last August after reportedly failing to pay more than HK$12 million in rent to the owners of a building at 182 Nathan Road. The landlords filed a lawsuit against Win Time Sing Technology Shenzhen, a mainland company owned by Tang, after the firm allegedly stopped paying rent in October 2019.
In January of this year, Tang and family were hit with another lawsuit seeking an outstanding debt of HK$265 million owed to an elderly care operator in which they held a stake.
In May, JLL announced that it had been engaged to market a set of senior living properties in Kowloon owned by Tang, with the serviced residences valued at HK$2.5 billion.