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Kerry Properties becomes latest Hong Kong developer to make huge land acquisition in China
- Kerry Properties, controlled by Malaysian billionaire Robert Kuok, pays 13.3 billion yuan (US$2.1 billion) for four plots in Shanghai
- Kerry joins Shui On Land, Hong Kong Land and Hong Kong Resorts International who have recently splashed billions on land purchases in top tier Chinese cities
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Hong Kong’s biggest developers continue to buy prime land sites in top-tier cities in mainland China, as they take advantage of the general malaise among competitors that are struggling to survive an unprecedented debt load in the industry.
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Kerry Properties, controlled by the Malaysian billionaire Robert Kuok, paid 13.3 billion yuan (US$2.1 billion) for four plots of mixed-use land in Shanghai during the municipal government’s first auction of the year on January 4. It plans to turn the site near The Bund, measuring 38,102.7 square metres (410,134 square feet) into what it calls a new Landmark, comprising a hotel, offices, shopping centres, high-rise apartments and town houses in Shanghai’s signature shikumen style.
“We anticipate the project will contribute good property sales income and add significant rental income, with capital value creation in line with the growth of mainland China,” executive director and chief financial officer Serene Nah said in a statement.
2022 is likely to be another high water mark for China’s debt defaults, with US$38.3 billion of offshore bond payments due in the first half. With many of China’s biggest land buyers – China Evergrande, Kaisa Group – all hamstrung by debt, Hong Kong’s developers are swooping in to pick up choice parcels.
The last time the Kerry group made such a big acquisition on its own in China was nearly three years ago when it paid 6.8 billion yuan in May 2019 for a residential-cum-commercial site in Hangzhou, the capital of eastern Zhejiang province.
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