China’s clampdown on outbound capital may have brought low once-powerful investors such as Dalian Wanda and HNA, but at least some players still have some cash to spend across the border, as a company controlled by directors of Shenzhen-based developer China Resources Land has now been revealed as the buyer of a HK$5.9 billion ($755 million) site on Hong Kong island.
An 18 July document from the city’s Land Registry confirms the record-breaking purchase of 39 Shouson Hill Road and links the new owners to the mainland developer.
“It is a record in the private residential site sales market in terms of consideration, breaking the previous record HK$5.1 billion deal set during the sale of Ho Tung Garden on the Peak in 2015,” Cathie Chung, national director of Consulting and Research for JLL in Hong Kong told Mingtiandi.
Mingtiandi had reported in early June that local media accounts had linked China Resources, the parent firm of China Resources Land, to the purchase of the 92,087 square foot (8,555 square metre) site. Now, Land Registry records reveal that a company called Charm Glory Resources (卓朗資源有限公司) paid HK$5.929 billion on 21 May for the property. The three directors registered for Charm Glory Resources are all members of the board of Hong Kong-listed China Resources Land, and the mainland developer’s investor relations director was listed as company secretary for the shell company.
The China Resources group bought a trio of Hong Kong properties with China Resources Land picking up a HK$1.1 billion, 5,223 square foot (385 square meter) site in Central in July 2017 and the parent company purchasing a pair of buildings next to Times Square in Causeway Bay for HK$1.68 billion in in June.
Site Expected to Become Hideaway Homes for Mainland Billionaires
39 Shouson Hill currently has two buildings with a total of twelve units, but the plot could be developed into a property with almost 70,000 square feet of usable space. In 2016, 15 Gough Road sold for HK$182,370 per square foot, and analysts say that 39 Shouson Hill, redeveloped to a high level, could potentially fetch a similar price.
“Given the very prime location, it’s easy to see the new buyers redeveloping the site as a super luxury product. Moreover, it reinforces the continued strong appetite by PRC buyers for prime residential sites in Hong Kong,” said Reed C Hatcher, director of research, Cushman & Wakefield.
Mainland Chinese buyers have had a significant presence in the Hong Kong property market for years, with the local press in Hong Kong reporting that half of the luxury properties sold are being purchased by mainlanders.
Shouson Hill a Traditional Luxury Location
The Shouson Hill property was last sold in 1962 for HK$200,000 and is on a lease that started in 1924 and continued on a 75-year basis with a 75-year extension. The property was sold via a tender which closed in April.
The location, which overlooks Deep Water Bay and was named after the first Chinese member of Hong Kong’s Executive Council, is considered one of the best addresses in the SAR. It is home to Cheung Kong chairman Li-Ka Shing as well as to the residence of the city’s Financial Secretary.