Developer eyes $2b from key projects

PUBLISHED : Thursday, 21 July, 2005, 12:00am
UPDATED : Thursday, 21 July, 2005, 12:00am

Kowloon Development expects to raise nearly $2 billion from property sales in Hong Kong and Macau this year, chairman Or Wai-shen said yesterday.

Revenues will come mainly from its Macau residential project La Baie Du Noble in the Orient Pearl district, which the company bought from parent Polytec Holdings International last year.

About $200 million is expected from the sale of its Padek Palace development on Prince Edward Road West in Kowloon City.

The strong cash inflows would enable the company to expand its Hong Kong and China property businesses, Mr Or said.

Minority shareholders of Kowloon Development yesterday approved the proposed acquisition of a 70.3 per cent interest in Shenzhen Properties and Resources Development (Group) for 458.57 million yuan.

The Shenzhen-listed company had assets of 2.46 billion yuan as of last year.

In addition to property investment, it operates department stores, hotels and restaurants.

Mr Or said Kowloon Development would use the newly acquired firm as a platform to expand into mainland real estate and infrastructure.

But he added that 'plans cannot go ahead until the company gets the final approval from Beijing authorities for the purchase of Shenzhen Properties'.

Approval could take as long as six months, Mr Or said.

In Hong Kong, Kowloon Development is looking for opportunities to acquire more land.

The company would continue to submit bids at auctions by the Urban Renewal Authority while also buying sites on the private property market, Mr Or said.

Last month, Kowloon Development filed a claim in the High Court against locally listed hotel operator Mexan over the cancellation of the $1.34 billion sale of Elizabeth House in Causeway Bay.

Mexan had agreed to sell the property in October last year but pulled out two months later because it had failed to meet asset-disposal requirements under the stock exchange's listing rules.

Earlier this month, Mexan sold the property to local property investor Lun Chi-yim for $1.48 billion.