HONG KONG (BLOOMBERG) - The United States has sold its consulate staff compound in one of Hong Kong's most exclusive neighbourhoods for HK$2.57 billion (S$452 million) to local developer Hang Lung Properties, amid escalating tensions between China and the US.
The price, announced on Thursday (Sept 10) by CBRE Group which handled the sale, was lower than the HK$3.1 billion to HK$3.5 billion valuation from Vincorn Consulting and Appraisal.
Hang Lung said it will invest about a further HK$4 billion to develop luxury detached houses on the site.
"The price of this rare and premium land lot is reasonable, and the purchase is a vote of confidence in Hong Kong's future," the firm said in a statement.
The site in Shouson Hill, on the southern side of Hong Kong Island, comprises six low-density apartment buildings spread over almost 8,825 sq m.
The property was sold with vacant possession, giving the buyer potential to develop luxury housing with views over Deep Water Bay, CBRE said.
A US government representative said on Wednesday that the decision to sell the property was part of its global reinvestment programme, and some of the proceeds from the transaction would be reinvested into multiple properties the US government owns in Hong Kong.
"It will not affect our presence, staffing, or operations in any way," the spokesman said in a statement.
The sale comes at a sensitive time, with US companies considering moving out of the city because of escalating political conflicts and disquiet over the national security law imposed by China.
An American Chamber of Commerce in Hong Kong survey last month found about 40 per cent of its 154 members were considering leaving the city.
Shouson Hill is one of the city's most exclusive neighbourhoods where some of the city's richest tycoons, including Mr Li Ka Shing, own houses.
The US government purchased the property in 1948, records lodged with the Land Registry show.
The site can be redeveloped into luxury accommodation, CBRE said in a statement.
An adjacent property was bought by Chinese developer China Resources Land for HK$5.9 billion in 2018.
