Swire Properties, which owns Pacific Place in Admiralty and Island East in Quarry Bay, says strong positive rental revision means a slowdown in office leasing activity has little impact on the performance of its investment property portfolio.
The assessment came after Swire announced underlying interim profit, excluding the revaluation gain from investment properties, rose 3.8 per cent to HK$2.44 billion from a year ago.
The increase reflects positive rental reversions and higher turnover rents in Hong Kong, improved rental performance at Sanlitun Village in Beijing, and a first-time contribution from the retail-office project, Taikoo Hui, in Guangzhou.
The positive effect of these factors was offset in part by the loss of net rental income following the disposal of Festival Walk in August last year and higher losses from property trading.
It said property trading recorded an operating loss of HK$18 million. Sales and marketing costs incurred in connection with the Azura and Agenta luxury residential developments in Mid-Levels West in Hong Kong exceeded profits from the sale of the remaining residential units in the Asia development in Miami, Florida.
Turnover increased 5.2 per cent to HK$4.9 billion, from HK$4.66 billion a year ago. Swire Properties will pay its first interim dividend of 22 HK cents since it was spun off from Swire Pacific.
'We will have a better second-half result,' chairman Christopher Pratt said.