China, Singapore key to Hongkong Land’s US$10 billion asset disposal goal

Analysts approve the developer’s ‘strategic pivot’, but caution that execution remains key to its success

Reading Time:3 minutes

Hongkong Land, which is controlled by conglomerate Jardine Matheson, manages US$32 billion of investment properties. Photo: Shutterstock

Published: 11:00am, 17 Nov 2024

Dozens of Hongkong Land’s assets in China and Southeast Asia are likely to be divested while those in Hong Kong are likely to be spared, as the developer shifts its focus to ultra-luxury commercial developments, according to analysts.

Last month, the developer, the biggest commercial landlord in Hong Kong’s Central business district, said its goal was to recycle US$10 billion in capital by 2035, including US$6 billion from development properties.

To reach this goal, Hongkong Land is likely to sell 37 of its residential projects on the mainland, six in Singapore and more than 14 across Southeast Asia, according to Xavier Lee, equity analyst at Morningstar.

“As Hongkong Land will likely retain at least partial ownership of their premium commercial properties, we believe they might recycle some of their malls in their ‘The Ring’ series, which is more mass-market in nature,” Lee said.

The Ring is the developer’s signature shopping centres in Chinese cities such as Chengdu and Chongqing.

Hongkong Land, which is controlled by conglomerate Jardine Matheson, manages US$32 billion of investment properties. It is selling and reshuffling its assets to unlock capital, an initiative made following a review over the past six months, according to CEO Michael Smith.