Li Ka Shing sells The Centre office tower for record $7b

Proceeds from the sale of The Centre would give CK Asset funds to diversify away from its main real estate business.
Proceeds from the sale of The Centre would give CK Asset funds to diversify away from its main real estate business.PHOTO: WWW.DISCOVERHONGKONG.COM

HONG KONG • Tycoon Li Ka Shing's CK Asset Holdings sold its 75 per cent holding in The Centre to a Chinese-led group for HK$40.2 billion (S$7 billion), a record for a Hong Kong office tower, the Hong Kong Economic Journal reported.

The deal will be announced in the near future, the Economic Journal reported, without saying where it got the information. Some domestic investors are also part of the consortium, the newspaper said.

The deal is the latest to signal Hong Kong's red-hot property market shows no signs of slowing down.

LVGEM (China) Real Estate Investment last week announced the HK$9 billion purchase of a building from Wheelock & Co a record per-square-foot price for a commercial building in Hong Kong's Kwun Tong area.

Earlier this year, Henderson Land Development paid HK$23.3 billion for the first commercial land to be sold by the government in the Central district in more than 20 years.

For CK Asset, the proceeds would give the company funds to diversify away from its main real estate business.

CK Asset and affiliate CK Infrastructure Holdings earlier this year agreed to buy a German maker of smart meters for about €4.5 billion (S$7 billion), building on the company's expansion in infrastructure and energy.

CK Asset's properties, which include Cheung Kong Centre and Hutchison House, spanned about 17 million sq ft as of June, with more than 80 per cent located in Hong Kong, according to the company.

Hong Kong's skyscrapers command the highest rents in the world, according to a report last month from Knight Frank, which said rental costs are more than four times higher than in Singapore.

Rental growth will continue to be robust on an influx of mainland Chinese tenants, Knight Frank said.

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A version of this article appeared in the print edition of The Straits Times on October 17, 2017, with the headline 'Li Ka Shing sells The Centre office tower for record $7b'. Print Edition | Subscribe