Pan Sutong, chairman of Hong Kong’s Goldin Group, and the city’s 16th richest man, has sold a commercial site in the Kowloon Bay area for an estimated HK$5 billion ($640 million), according to an account in the Hong Kong press.
Pan sold the former location of Goldin Financial Global Square at the corner of Wang Tai Road and Sheung Yuet Road in the east side of the Kowloon peninsula to an unidentified buyer after originally purchasing the property in 2011.
The building which is located in the heart of Kowloon Bay’s commercial center, is considered a prime candidate for redevelopment, thanks in part to its proximity to a number of Grade A buildings including the Exchange Tower, One Kowloon and the brand new FT Life Tower, the Hong Kong Economic Times reported.
Project Sells for HK$12,500 Per Square Foot
Pan, whose fortune is estimated by Forbes to total $4.9 billion sold the 33,584 square f00t (3,120 square meter) site, which is approved for construction of up to 400,000 square feet of gross floor area at the equivalent of HK$12,500 per square foot of new space.
According to the Hong Kong media, the project if redeveloped into a grade A commercial building the project could fetch between HK$16,000 to HK$17,000 per square foot.
As early as 2015, there were already reports that the Goldin Financial Global Square was the topic of discussions with potential buyers. At the time, the asset was said to be valued at HK$2.5 billion, equivalent to HK$6,250 per square foot of new space.
Goldin Profits in Kowloon East
Public records show that the Goldin Financial Global Square, originally a factory building, had previously been purchased by Albert Yeung’s Emperor Group for HK$525 million in 2008.
The Hong Kong developer renamed the 11-story building as the Emperor International Square and subsequently sold it to Pan for HK$850 million in 2011. Pan then changed the building’s name to Goldin Financial Global Square.
With Kowloon Bay being redeveloped from its industrial roots into Hong Kong’s emerging commercial hub, Pan later paid an additional HK$1.65 billion land premium at HK$4,600 per square foot to change the building’s usage from industrial to commercial.
Goldin Financial Global Square is not the only asset Pan and his Goldin Group have owned in Kowloon Bay. The developer also redeveloped a commercial parcel on the corner of Wang Kwong Road and Kai Cheung Road which it had acquired for HK$3.43 billion into the 27-storey Goldin Financial Global Center.
Completed in 2017, the 800,000 square foot building about 750 metres walking distance from the Goldin Financial Global Square is currently 80 percent occupied with tenants including telecommunications provider PCCW. The building has average monthly rents of HK$30 per square foot.
In November last year, the financial conglomerate won a 104,496 square foot (9,708 square meter) residential plot on the runway of Hong Kong’s former Kai Tak Airport, which is also part of the Kowloon Bay, for HK$8.9 billion ($1.14 billion).
Kowloon Bay Continues to Climb
Kowloon East’s transformation has in recent years attracted both domestic and foreign capital. In February, private equity firm PAG purchased the 660,301 square foot Mapletree Bay Point in the area for about HK$8.58 billion, which valued the 2017-vintage property at just under HK$13,000 per square foot.
In 2017, Wheelock subsidiary Wharf Group sold its 8 Bay East office tower on the Kowloon East waterfront to mainland developer LVGEM for HK$9 billion ($1.2 billion), in one of the biggest real estate deals in Asia that year. The development, now named as NEO Kwun Tong, has recently opened and is currently leasing.