Developer rejects the need for incentives
THE Hong Kong Parkview Group has no intention of following the lead of other developers by offering cut-rate prices for its luxury units.
Neither is it interested in any other incentives to lure buyers to purchase the firm's flats at Tai Tam Reservoir Road, according to the company's chairman, George Wong Kin-wah.
'The units are always available to buy,' Mr Wong said after the company's annual general meeting held at the group's flagship property, the Hong Kong Parkview, on the south side of Hong Kong Island.
'But we are not putting any of the units on to the market because we don't think the price is right.' He said the company was satisfied with the rental income generated by the units.
'We are attracting a very good rental income, so why would we sell cheap?' he asked.
'Parkview is good for the long term. It is good for when the market picks up.
'So I am not desperate to sell the units at the moment.' The Hong Kong Parkview Group has been hit hard by the downturn in the property market.
Last month, the group, which also has interests in shipping, household furnishings and cars, reported a 74 per cent plunge in profits attributable to shareholders for 1995, as compared with 1994.
Profits dropped from $303.1 million in 1994 to $76.6 million for the year on a reduced turnover in 1995 of $813.24 million as compared with $1.3 billion the previous year.
The sale of investment properties fell by two-thirds to $101.7 million in 1995 from $358.5 million last year.
'I'd be lying if I said the market was good,' Mr Wong said after the group's annual general meeting.
'But if you have a quality product at a low price then it will have a certain attractiveness to the market.' He said local consumers would still buy units as long as they were attractive and reasonably priced.
A good case in point he said was University Heights, a luxury development that has attracted a lot of attention despite the downturn in the local property market.
Mr Wong said he liked the moves initiated by the banks to drum up interest in the property market by offering better mortgage rates.
He said the decision by Wheelock Properties to offer home buyers a second mortgage was a positive move for the local market.
'All of these attractive packages are a plus for the market,' he said.
However, Mr Wong said Parkview would not offer such incentives.
'No, I don't have anything like that to offer,' he said.
Mr Wong announced that the company's luxury development in Tai Po would be completed by late next year, but said he did not know how much the units would sell for.
'The market changes so fast and with 1997 it is very difficult to predict what will happen,' he said.
Mr Wong said he was not deterred by the downturn in the Hong Kong property market.
He said that the lower prices were an incentive for the company to get involved in different projects. 'The only downside in this market is that I can't produce attractive revenues for the shareholders which I look to do as director of the company,' he said.
'Apart from that this is a better opportunity for us.' Mr Wong said he was optimistic about the company's property developments in China, particularly in Shanghai.
'The market is down at the moment, and people don't know what we're building, but when it is completed, they will appreciate it,' he said.
The first phase of the Hong Kong Parkview Group's project in Shanghai is a three-storey, 660-unit development scheduled for completion sometime next year.
Flats were selling for US$70,000, he said.
These were being sold mainly to overseas Chinese from Hong Kong, Taiwan and Singapore, as well as to some locals.