Peak home sells at last

A foreclosed house on The Peak was sold for HK$171 million after being on the market for three years, with the price per square foot at HK$71,600. The offered price decreased 43 percent compared with seven years ago.

Meanwhile, the property agency index showed that rents for private homes stood at HK$33.90 per sq ft in June, the first rise after falling for 10 months, while land premiums in the second quarter amounted to HK$570 million.

L'aquatique in Tsing Lung Tau, built by mainland developer Metallurgical Corporation of China (1618), has recorded forfeited deposits from potential buyers of 23 units, accounting for 29 percent of its 80 transactions.

The occupation permit of L'aquatique has not been approved for a year due to slope work.

China Overseas Land and Investment (0688) has named its project at Kai Tak as One Victoria, which is expected to be completed in the first quarter of 2023 and offer 1,059 units.

A 362-square-foot unit at Tsuen King Garden, Tsuen Wan, changed hands for HK$5.55 million, or HK$15,331 per sq ft. The first-time buyer did not view the flat.

A real estate agency predicted that companies may delay decisions on real estate requirements, amid the net withdrawal in all major office markets, with Central leading the way with 500,000 sq ft less in the first half, as overall demand weakened.

The University of Hong Kong bought the rest of Novum West in Sai Ying Pun, developed by Henderson Land Development (0012), for HK$459 million last month, after it acquired part of the commercial project for HK$504 million in 2018. The property is said to be purchased for teaching and research purposes.

In other news, the one-month Hong Kong interbank offered rate dropped for a fourth consecutive day to 0.3297 percent, the lowest since October 28, 2016.

(The Standard)

Chinese firms seeking Hong Kong listings amid US hostility may help buoy flagging office rental market as space the size of Lippo Centre abandoned

Mainland firms embarking on secondary stock listings in the city amid rising tension between Beijing and Washington may absorb some of the pain as abandoned office space soars to 18-year high

In first half of 2020, tenants bailed on 1.3 million sq ft of office space – the size of Admiralty’s Lippo Centre – as they tried to cut costs to stay afloat

Companies are giving up their office space in Hong Kong at an almost unprecedented rate as the economy tanks in the wake of Covid-19, which piled further misery on top of the city’s year-long political crisis.

But observers say there is a glimmer of hope for the world’s most expensive office market: mainland Chinese firms setting up shop as they embark on secondary stock listings in Hong Kong amid rising tension between Beijing and Washington.

With the Trump administration pushing legislation that could lead to delistings of US-traded Chinese companies, some firms are gearing up for secondary stock offerings in the city to fend off the threat. Gaming company NetEase and JD.com, China’s second-largest e-commerce platform, have recently spearheaded the expected stampede by debuting in Hong Kong.

“Secondary listings of mainland firms on the Hong Kong stock exchange are expected to lead a pickup in leasing demand in the city,” property agent said. “Although it may not immediately result in these companies taking on large office spaces, the downstream business opportunities for ancillary finance and business services will support overall growth.”

Some mainland Chinese tech heavyweights, including the Post’s owner Alibaba and ByteDance, have recently committed to new leases of large swathes of premium office space in Hong Kong.

It may not be enough to counterbalance surging vacancy rates.

The amount of surrendered space – offices vacated by occupants before their lease expires – in Hong Kong is at an 18-year high as multinationals elect to downsize their footprint in the city.

In the first half of this year, tenants bailed on 1.3 million sq ft of office space – the size of Admiralty’s Lippo Centre or Kowloon East’s Landmark East – as they tried to cut costs to stay afloat. About three quarters of the abandoned space is on Hong Kong Island.

“Leasing demand will remain subdued in the second half of this year due to the weakened economy,” the agent said in an online “midyear property review” briefing.

The agency predicts Central office rent will fall by up to 30 per cent this year as the amount of vacant office space continues to rise.

The premium, or grade A, office market recorded a negative take-up of 1.42 million sq ft in the first six months, among the highest net withdrawals from the market ever recorded, according to the agency.

Rents in Central have dropped almost a quarter from their peak in April 2019 as companies relocate to cheaper districts.

“Corporate solvency has become an issue as more firms opt to downsize or close altogether in a business environment facing numerous challenges over the next six months,” another agent said.

The total amount of office transactions plummeted by 83 per cent in the first half, according to another agent.

“The global epidemic situation was severe, and many countries in Europe and the United States closed their borders to prevent the spread. The economy and pace of corporate expansion was greatly affected,” the agent said.

During the pandemic, many companies have asked their employees to work from home. Having realised some of its benefits, some have taken the opportunity to control costs, downsizing their offices by 5 to 20 per cent, another agent said.

That trend alone may push the vacancy rate of the office market higher than its current 8.1 per cent, she said.

Some smaller businesses, and those in purchasing and shipping, have had problems paying their rent, the agent said, pushing landlords to take legal action. Some have just walked away from their leases and abandoned the office space, the agent added, though that has not happened as much as it did during the Sars outbreak in 2003.

E-commerce giant Alibaba has committed to another storey – floor 27 – of Tower One in Times Square, covering about 17,000 sq ft for HK$1.03 million a month, or HK$60 per sq ft. That is about 10 per cent less than the space was previously leased for, according to property agency. Including the offices of the South China Morning Post, Alibaba has now rented 11.5 floors of Times Square, becoming its biggest tenant.

ByteDance, the owner of short video platform TikTok, has entered into a three-year lease for about 3,000 sq ft in the same building, according to property agency.

Guangzhou-based developer KWG Group Holdings recently rented 25,609 sq ft at The Center, Hong Kong’s priciest commercial tower, according to property agency.

Some major mainland financial institutions, such as CMB International Capital, China Minsheng Bank and Orient Finance Holdings, were also said to have signed up for additional office space in Central while their foreign counterparts consider downsizing, the consultancy added.

“Although the unemployment rate in finance, insurance, real estate and business services hit a 10-year peak, we see a resurgence in demand from [mainland] technology and finance companies and flexible space operators, which supports the office leasing market,” agent said.

Despite the entry of mainland firms, the outlook for Hong Kong’s office market remains cloudy, as withdrawals outpace new lettings.

“While we are seeing inspection activities gradually picking up, occupiers remain very cautious,” another agent said. “A majority of current leasing mandates are for cost-control or cost-saving purposes, whilst new and expansion needs remain very limited.”

(South China Morning Post)

活化工廈接44宗申請 逾6成獲批

政府在2018年施政報告重啟活化工廈，容許業主向城規會申請放寬地積比進行重建，據發展局昨回應立法會議員查詢時指，截至今年6月底，共接獲44宗申請並有28宗獲批，可提供約587.7萬平方呎樓面。

政府重啟活化工廈計劃，容許業主申請放寬非住用地積比率以進行重建，最多為2成，以重建1987年前落成的工業大廈。據政府表示，截至2020年6月30日，城規會共收到44宗申請(不包括已撤回的兩宗個案)，其中獲批的項目共有28個，不獲批1個，另有15個正在處理中。

就已獲批的28宗申請，18宗需要向地政總署申請土地契約修訂，以落實重建，並已有11宗向地政總署申請。為加快重建，政府正就現行的補地價仲裁先導計劃訂立改善措施，並快將推出實行。

28宗獲批項目 提供588萬呎

政府表示，該28宗已獲批的項目，有潛力提供約587.7萬平方呎樓面，包括約276.6萬呎商業樓面及311萬呎工業樓面。據了解，現時活化工廈申請中，較多個案集中東九龍區，預計將成新供應重鎮。

(經濟日報)

港大兩年斥10億 購翰林峰商場

土地註冊處資料顯示，鄰近香港大學的新盤翰林峰商場部分，再獲香港大學以近4.6億元購入，值得一提的是，兩年前港大已經購入商場另外的部分，當時作價約5億元。

資料顯示，翰林峰商場A部分，以4.596億元易手，面積19,533平方呎，呎價23,529元。

香港大學發言人表示，就2018年購入的部分，香港大學牙醫學院正籌備專科培訓診所，預計今年下旬投入服務，詳情稍後公布。至於新近商討購入的部分，將用作港大學生設施，供同學使用。

(經濟日報)

葵涌瑞康工廈全幢標售 估值逾5.6億

受惠活化工廈政策，樓齡大，業權集中的工廈成為市場收購的焦點，而現正招標放售的葵涌瑞康工業大廈，涉及9成業權聯合標售，估值約5.6億元。

葵涌瑞康工業大廈，位處葵涌青山公路葵涌段547至549號，樓齡約49年，樓高12層，地盤面積約14,291平方呎，現有建築面積約14.7萬平方呎，為西九龍罕有的高潛力項目，而物業鄰近住宅群及商貿區，加上受大灣區利好輻射，以及受惠活化工廈政策2.0前景看俏，項目現正招標，截標日期為2020年8月28日(正午12時)。

有代理指，瑞康工業大廈目前超過9成業權出售，亦可商議100%業權出售，此外，該廈現有地積比率為9.5倍，高度限制為105米，以現時非住宅地帶工廈可申請全幢重建工業大廈，或補地價重建為商廈或酒店，容許放寬非住宅用地積比率上限為20%，故重建或活化工廈，較其他工廈享有較高的資本值增長。

涉及9成業權 重建活化皆宜

位置上，該廈距離港鐵葵興站約10分鐘路程，至西九龍高鐵站及港鐵中環站亦於20分鐘之內可抵，而項目同時鄰近青山公路、昌榮路、葵涌道等主要幹道，前往港珠澳大橋及機場等地亦只要20分鐘，有利跨境公司。而受惠於政府推出活化工廈政策2.0，瑞康工業大廈的發展潛力及彈性大增，項目可選擇重建或全幢出售，價值亦相應提升，而在新政策下，預計市場對全幢物業大有興致。

(經濟日報)