〈Asian Post, Dec 24, 2016〉A consortium led by Goldin Financial (0530), a company with a mainland capital background, has beaten five major local developers to acquire MTR Corporation's (0066) residential site on top of Ho Man Tin station.

Other bidders included Sun Hung Kai Properties (0066), Cheung Kong Property (1113), Wheelock (0020), New World Development (0017) and a consortium led by Sino Land (0083).

Land premium for the site was reported to be about HK$6.28 billion or about $8,459 per square foot. Developers were also required to put up a lump sum in addition to the land premium in bidding for the site.

The developer winning the site will have to share 35 percent of the profit from the Ho Man Tin project with MTR Corp. Goldin Financial did not reveal the partners in the consortium and investment amount in the project but indicated that the company's chairman Pan Sutong, who also controls Goldin Properties Holdings (0283), was one of the major investors.

The company said the site was a rare quality residential site located in the urban area and that the price for the site was reasonable. It plans to develop the site into a luxury residential project.

Earlier in March, Goldin Financial acquired a Ho Man Tin residential site on Sheung Shing Street for $6.38 billion, or $10,889 per buildable square foot. The company believes the two Ho Man Tin sites will have a synergy effect. It also indicated that Pan is confident about the long-term development of Hong Kong's property market.

The Ho Man Tin station site occupies a construction area of about 150,696 square feet and has a maximum gross floor area of 742,716 sq ft.

The building is expected to be completed between 2022 and 2023 and is estimated to be able to provide 800 to 1,000 flats.

"Goldin Financial winning the Ho Man Tin station site is not a surprise," said Knight Frank senior director Thomas Lam Ho-man.

"The company has experience working on projects in Hong Kong and its two residential sites in Ho Man Tin will produce a synergy effect," said Lam.

Goldin Financial's commercial project in Kowloon Bay, Goldin Financial Global Centre, officially opened on October 31 and the first batch of tenants will move in February. Goldin Financial operates other businesses including factoring a financial service and has a vineyard in the United States.

〈China Daily, Dec 23, 2016〉Hong Kong property, hotel and retail conglomerate New World Development is poised to thrust its popular K11 shopping mall brand — the brainchild of the group’s Executive Vice-Chairman Adrian Cheng Chi-kong, founder of K11 and K11 Art Foundation — across the Chinese mainland over the next five years as it continues to ride on the label’s growing image.

According to Cheng — a grandson of the late New World Group patriarch Cheng Yu-tung — more than 16 K11 malls will roll out in at least half a dozen top and second-tier mainland cities from 2017.

“This is because we’ve been very successful here in Shanghai, where we have created a cultural hub,” Cheng told China Daily earlier this week after a launching ceremony for Vivienne Westwood’s “Get A Life” Exhibition at K11 Shanghai.

At present, there are two K11 shopping malls in China — one in Tsim Sha Tsui, Hong Kong, which opened in 2009 and claimed to be the world’s “first art mall”, and the other in Shanghai, which went into service in mid-2013.

New World says it has created an “art x commerce” business model, calling it a “museum retail” concept. By introducing a host of art works and organizing art exhibitions at these malls, it has managed to enhance its connection with young customers, and the model has been a success story, particularly in Shanghai.

In the past three years, K11 Shanghai has seen its revenue grow in double-digit percentage terms annually, drawing an average of 1.5 million visitors monthly this year, Cheng said.

He pointed out that K11 is focused on attracting millennials — those from early 1980s to late 1990s generation who are not only interested in purchasing goods, but also fond of the cultural and history behind the products. They want unique, tailor-made, personalized shopping experience and, by introducing the “museum retail” concept, customers are better engaged with K11, said Cheng.

K11 has built up a very strong contemporary Chinese cultural eco system, and it’s very confident of spreading such a system to other mainland cities, he said.
New World will launch K11 shopping malls in Shenyang, Wuhan and Guangzhou this year, while K11’s social, innovative and sustainable business model will help the company start K11 offices, as well as K11 art stores it already has.

“Hopefully, the brand itself will become both a cultural and an art identity,” Cheng said.

K11 shopping malls are also due to go up in Beijing, Tianjin and Ningbo in the next five years, Cheng said, explaining that the focus will be on first- and second-tier mainland cities for the time being.

“We’ve said we will have 16 (K11 projects) in the next five years, but there could be more, as you can see that New World Development has tendered for more land on the mainland.”

〈The Standard, Dec 22, 2016〉Retirement spending for affluent couples climbed to HK$47,660 a month, according to a survey commissioned by HSBC.

The estimate is 2 percent higher than last year, mainly because of the price hikes for food, housing, leisure and entertainment. Costs for three different lifestyles are included in the study. A basic lifestyle for a retiree living in public housing needs to spend about HK$5,540 a month - or HK$9,165 as a couple - with 43 percent going to food and 25 percent meant for rent.

For locals who own mortgage-free properties and want a comfortable retirement life, HSBC suggested that an average of HK$23,340 is needed for single retirees and HK$29,530 for couples.

Maintenance of the properties and hiring a domestic helper are the two top expenditures for this group, each accounting for more than 20 percent of living costs. Transportation expenses take up 19 percent.

For a more extravagant retirement life - usually for property owners with incomes that used to belong to the top 5 percent of the population - retirees would need to splash out HK$36,145 for singles, and HK$47,660 for couples living together, the study showed. This group would tend to spend twice as much on food and clothing than those retirees in the comfortable life category.

Alfred Yip Sze-ki, head of pensions at HSBC Hong Kong, recommends an early start for retirement planning, as inflation may pose a direct impact on estimated costs.The study took into account government statistics on the expenses of locals from various age and income groups, prices of specific goods and services, as well as retirees' consumption behavior.

Meanwhile, HSBC also published a survey indicating the SAR's trade confidence score has increased since the US presidential election, with the services trade expected to rise 7 percent annually over the next 15 years.

〈Asian Post, Dec 22, 2016〉Hong Kong's home prices are unlikely to see a significant fall amid solid demand, despite the increasing interest rates and the government's measures to curb growth, according to Standard Chartered.

"I can't see Hong Kong's property prices falling too much considering the demand and supply, and mainland investors are still buying overseas assets," said May Tan, chief executive for Hong Kong at Standard Chartered Bank.

Analysts expected Hong Kong's property prices to tumble after the US Federal Reserve increased the interest rate by 25 basis points last Thursday, which was followed by the Hong Kong Monetary Authority, the city's de facto central bank.

Hong Kong's commercial banks have kept their prime lending rates unchanged, but home buyers are set to face higher costs on mortgage loans next year as the US Fed foreshadowed raising interest rates for another three times next year.

Banks such as HSBC, Bank of China Hong Kong and Hang Seng have kept the prime lending rate at 5 per cent, while Standard Chartered, Bank of East Asia and DahSing Bank have maintained theirs at 5.25 per cent.

Although the bank did not increase its lending rate, Tan said there was little room for the bank to offer more preferential mortgage rates. However, she is relatively optimistic about the property market as she said investors are still seeking to allocate assets to properties which offer reasonable return on investment.

In addition to the growing interest rates, Hong Kong's recent measures, including an increase in stamp duty that took effect on November 5, have put pressure on the city's real estate sector.

Tan, also chairwoman of the Hong Kong Association of Banks, said the increase in stamp duty will dampen housing demand in the secondary market for the short run, while the impact on new residential property sales would be limited. She led a delegation of the association in an annual visit earlier this week with mainland financial authorities.

〈Asian Post, Dec 22, 2016〉MTR Corp has received just six bids from developers, largely local players, for the tender of a luxury residential project above Ho Man Tin MTR Station despite the government offering a lower than expected land premium to drum up interest.

The outcome stood in marked contrast to the overwhelming response to most government sites sold through tender. "The number of bids is lower than my expectation," said Alfred Lau, a property analyst at Bocom International.

"The only explanation is that most developers have a lack of experience cooperating with MTR Corp." He said the outcome would not have been greatly affected by a 25 basis point increase in US interest rates last week or the new stamp duty on property purchases introduced in Hong Kong on November 5.

The stamp duty on property transactions for non-first-time buyers will be raised to 15 per cent for individuals and corporate buyers.

Chief Executive Leung Chun-ying has said the measures were implemented because home prices have risen too quickly.

Last week's government tender of a residential site at Kai Tak attracted 21 bids, with HNA winning the plot for HK$5.41 billion on Monday.