Hines Opens Tsim Sha Tsui Project as First Hong Kong Rental Residential Venture

Hines on Friday announced the official opening of its first-ever rental apartment complex in Hong Kong as the US developer continues to expand its bets on multi-family residential in Asia Pacific.

Dash on Prat, an 18-storey co-living facility in the city’s Tsim Sha Tsui area, is being operated by local rental housing operator Dash Living, and is aimed at junior members of Hong Kong’s region-leading service sector, according to Hines’ leadership.

“This is an exciting option for young professionals that provides them with independence, comfort, amenities and community,” Chiang Ling Ng, Hines’ chief investment officer for Asia, said in the release. “As we continue to invest across the living space, we continue to seek out similar residential opportunities in the region.”

Hines had acquired the former Butterfly on Prat hotel in November 2021 through a joint venture with local investment firm Mindworks Ventures, with market sources indicating at the time that the partners paid HK$925 million (then $118.6 million) for the 18-storey property.

Strong Demand Seen

Since the time of that acquisition, Hines and its partners have been at work renovating the building’s 158 guest rooms as well as adding retail space and shared amenities on the ground floor of the 4,200 square foot (390 square metre) block.

The property now incorporates shared amenities such as a communal kitchen, laundry area, workspace, lounge and yoga room, with rooms ranging from 210 square feet to 395 square feet.

The company’s senior managing director and country head for Greater China, Claire Cormier Thielke pointed to both housing affordability and opportunities to offer residents a ready-made community as central to the appeal of the project.

“In markets with high prices like Hong Kong, this differentiated accommodation offering aims to allow tenants to share experiences, develop their network, form relationships and build on the Hines promise of providing high quality living,” Thielke said in the statement.

Located on a 6,000 square foot site at 21 Prat Avenue, Dash on Prat is a short walk from the East Tsim Sha Tsui MTR station and is around 10 minutes by foot from Wharf’s Harbour City shopping complex, for tourists seeking imported luxury brands.

Hines purchased the former hotel late last year on behalf of its pan-Asian core-plus fund, Hines Asia Property Partners, which also holds a set of 11 Japan multi-family assets acquired in December. The company has also been pursuing rental residential projects in Australia as it seeks to expand its multi-family bets in Asia Pacific.

Dash Ramps Up

The converted hotel will now serve as the flagship location for Dash Living, which now operates more than 2,000 rooms across Hong Kong, Singapore, Tokyo and Sydney and is backed in part by Mindworks.

Speaking of the partnership with Hines, Dash founder Aaron Lee said, “Together we are leveraging Dash’s global sharing economy, community and technology to unlock value in prime assets like Dash Living on Prat in Hong Kong.”

The rental housing operator has also formed a partnership with PGIM Real Estate to operate rental accommodation facilities in Hong Kong after the US investment giant acquired a pair of hotels in the city in early 2022.

Rents Picking Up

Hines’ opening in Tsim Sha Tsui comes as analysts predict a muted recovery in Hong Kong’s rental housing sector after a slump in 2022.

In a market report published in January, Savills showed that rents for serviced apartments across the city dipped by 0.1 percent in the fourth quarter from the previous three months for hotel-like properties, and a steeper 3.2 percent decline for apartment-like units in the same period.

Occupancy rates averaged 62 percent at the end of 2022 and rents for luxury homes fell across the New Territories and the Hong Kong Island by as much as 3.1 percent in the fourth quarter, while leasing rates in Kowloon ticked up by 0.1 percent in the same period.

Hong Kong lifted its quarantine rules and border controls late last year and dropped its mask requirement just last month in an attempt to boost tourism and spur economic recovery.