7/5/2018-3

Three or four buildings in Taikoo City are sold at a market value of 20 billion yuan

Swire Properties (1972) issued a notice yesterday and said that it is considering the sale of the third and fourth commercial buildings in the Taikoo Shing Center and is currently conducting discussions. A spokesman for Swire Properties stated that the company continued to seize business opportunities to enhance shareholder returns. The commercial market was very robust and the market recently had a keen interest in the commercial buildings. Some real estate professionals estimate that the value of the two commercial buildings is about 15 to 20 billion yuan.

Looking back at the Swire Properties Annual Report, the Taikoo Shing Center has a third floor with a total area of ​​226,000 square feet and a fourth block with 54,000 square feet, which totals approximately 770,000 feet. According to Swire Properties’ announcement, it is possible to sell the two buildings together or separately.

The quality of the ideal landscape is well-received. Stephen Chao, the managing director of valuation and professional consulting at Davies, believes that the value of the two properties may be between $15 billion and $20 billion. It also means that the quality of the property is ideal. Good, I believe it will be sought after by buyers. Zhang Shengdian, Director, Corporate Development Department, Valuation Group ( Valuation and Property Management), pointed out that if the Taikoo Shing Center’s valuation at the time of sale was equivalent to a rental return of 2.3 to 2.5 per cent, Reasonable level. He said that the rental of commercial buildings is limited, and it is reasonable for Swire Properties to sell them at high prices.

Swire Properties has released operating data for the first quarter of this year, which shows that the rental rate of the Tai Koo Shing Centre commercial building is 97%, while the rental rate for the Taikoo Shing Centre is between $40 and $50.

Swire sold properties from time to time in recent years and sold the Festival Walk Shopping Centre in Kowloon Tong to Singapore Mapletree Industry in 2011 for a price of 18.8 billion yuan. In 2016, Swire Properties also sold the Grade A commercial building project at Wangjiao Road and Linli Street in Kowloon Bay to RMB 6.528 billion for Zhu Li Yuehua, the CEO of Kingston, which is known as the “after shell”.

In recent years, the entire commercial building has changed hands. The most sensational event is the fact that Cheung Kong (1113) sold the Central Centre in November last year for a price of $40.2 billion, making it the largest ever transaction in Hong Kong’s property market. In addition, Champion REIT (2778) was announced in July last year to explore the sale of Langham Place Commercial Properties in Mong Kok. However, when the company announced its results earlier this year, it stated that the trustee had not received any letter of intent regarding the sale of Langham Place Commercial Building.