Hong Kong entertainment giant Emperor International has announced to the Hong Kong Stock Exchange that it is selling a hotel property in Hong Kong’s Yau Ma Tei district for HK$1.1 billion ($140 million) to “Shop King” Tang Shing-bor, who is stitching together a redevelopment plan for the area.
Tang has purchased several buildings on Portland Street, smack in the middle of Kowloon’s red-light district. The latest acquisition of Inn Hotel, at 60 Portland Road, is one of several purchases of strata-title property in the neighborhood.
Another Piece of the Puzzle
In 2014, Tang was reported by local media to have paid HK$50.2 million for seven residential units in the 55-year-old detached buildings at 45 to 52 Portland Street, giving him over 20 percent ownership of the buildings. Then, from 2014 to 2017, Tang paid a total of around HK$650 million to buy the rest of the residential block, with a plan to use Hong Kong’s Compulsory Sale law in order to redevelop the properties.
Tang on Tuesday confirmed a local media report that he was the buyer of the Inn Hotel, although he did not specify what his plans were for the building and the neighboring properties.
Tang is expected — for the time being — to put the new acquisition into the hotel portfolio of his youngest son, Stan Tang, whose company, Stan Group, currently operates eight hotels in the city.
According to the sales agreement, Tang will pay a total of HK$1.1 billion for the 199-room hotel before June 10th of next year. Emperor International said the property disposal will help it to improve its financial position and give it additional reserves for future investment opportunities.
Huge Space to Fill
Inn Hotel Hong Kong is a 30-storey building comprising 48,600 square feet (4,515 square metres), with a footprint of around 1,620 square feet. The ground floor and first floor are currently rented out to a café operator. The hotel is a one-minute walk from the MTR Yau Ma Tei Station and a 10-minute walk from the popular Temple Street night market in Mong Kok.
According to a local media report, Emperor International bought the building for HK$197 million in 2013, and invested around HK$500 million to renovate it into a three-star hotel, which opened for business in 2014. According to Emperor, the latest sale brings a nifty HK$746 million in income compared to the price it paid to purchase the property four years ago.
Wheeling and Dealing
Tang’s latest acquisition followed his September sale of an 80-room hotel in Wanchai in exchange for a potential housing site in Sai Kung. Tang sold the Minimal Hotel Urban, which he had purchased just last year, to CNT Group for HK$530 million.
The deal, which brought Tang a quick HK$80 million, was made under a sale-and-leaseback arrangement, with the hotel continuing to be leased by Stan Group at a monthly rate of HK$1.33 million for the next three years.
Stan Group owns more than a dozen properties in Hong Kong, comprised of residential, commercial and industrial assets, mostly in Kowloon and the New Territories. The properties include six restaurants, a spa, a fitness centre and eight hotels under three brands in Hong Kong.