HK shop sold for 2nd highest psf price in city

Source : Business Times – 14 May 2009

Brother of tycoon pays HK$447,800 psf, banks on influx of mainland visitors

The brother of a Hong Kong property and gambling tycoon has paid the second-highest per square foot (psf) price on record for a shop in the city, hoping to benefit from an influx of mainland Chinese visitors.

Ricky Yeung bought a 134 square footshop in Kowloon for HK$60 million (S$11.3 million), Tony Lo, director of Midland Realty Shop Ltd, said yesterday.

Valued at HK$447,800 psf, the shop is the second most expensive sold in Hong Kong after a 40 sq ft retail space went for HK$515,000 psf in March 2006, he said.

‘There’s a lack of supply in the area as most of the shops are in malls that are owned by Wharf (Holdings) Ltd,’ Mr Lo said. Mr Yeung, Midland’s client, is the brother of Albert Yeung, he said.

Mr Albert Yeung controls developer Emperor International Holdings Ltd, luxury-watch retailer Emperor Watch & Jewellery Ltd and hotel and casino company Emperor Entertainment Hotel Ltd.

The street-level shop is near Wharf’s Harbour City, one of Hong Kong’s biggest shopping centres, and the Star Ferry pier in Kowloon.

The mall and Wharf’s Times Square in Causeway Bay on Hong Kong island account for 10 per cent of the city’s retail sales, Wharf deputy chairman Stephen Ng said in March.

Rents for retail shops in Hong Kong dropped 20 per cent between October and February and may have reached bottom as more mainland Chinese visit, Wong Leung-sing, an associate director at Centaline Property Agency Ltd, said yesterday. The price of leases has risen by 2 per cent since February, he said.

Shenzhen, the adjoining southern China export hub, relaxed rules last month for residents’ travel to Hong Kong.

About 2.2 million Shenzhen residents can now apply for multiple-entry visas to Hong Kong, China Daily reported in April, citing local public security authorities. They were previously only allowed to apply for double-entry three-month visas.

Mr Yeung, who sees the shop as a long-term investment, hopes to rent it for more than HK$200,000 a month, double current prices, when it becomes vacant in July, providing a rental yield of 4.5 per cent, Mr Lo said.

The sale was reported earlier by the South China Morning Post.

The number of Hong Kong office and retail-space real estate transactions has risen to the highest since August last month, climbing 27 per cent from a month earlier to 648, the Wen Wei Po newspaper reported last week.

The combined transaction value fell 9 per cent month on month to HK$2.69 billion, the paper said.