Towering above the storm clouds
High-level investors have a handy Chinese maxim to fall on when asked on how they will fare in uncertain economic times - it's the one about crisis and opportunity sharing the same characters.
John Chow Wai-wai, managing director of Winsor Properties Holdings, and Gerry Kipling, managing director of Property One, have seen such storm clouds gathering over financial markets before. For them, previous cycles of economic turbulence share one factor: Hong Kong's commercial property sector has pulled through and it's business as usual once the jitters subside.
It's amid this maelstrom that the twin towers of Winsor's HK$7 billion Landmark East at How Ming Street in Kwun Tong stand steadfast as the finishing touches are put in place ready for approximately 1.3 million sqft of grade-A office space to fully open.
'In our market we are not just targeting the financial sector. For Landmark East we haven't been relying on that particular segment,' said Mr Chow, adding he could not yet reveal the confirmed tenants other than to say the list included multinationals, local companies and 'Kwun Tong upgraders'.
'We will be very careful in picking our tenants; looking at major clients in the next couple of months when we are able to announce the type of tenants that have signed up.'
He said the key for the viability of the office sector in Kowloon was that there was no new supply in Central.
'The property business will go on,' said Mr Kipling, whose company has had a long association with Winsor as property managers. 'We are in a city where there are very diverse business activities and frankly, if anything, this financial correction will be to the advantage of developments, such as Landmark East, because it offers outstanding specifications at real value for money.'
Developers seem to be using this part of East Kowloon to showcase some of the latest technology for building interiors, security, sustainability and outstanding architecture. Arquitectonica, an award-winning US-based firm led by renowned architect Bernardo Fort-Brescia, acted as design architect for the Landmark East project.
The two towers display an eye-catching geometric form above a fully landscaped 35,000 sqft landscaped garden next to a 100,000 sqft public open space. This is part of enabling connectivity for people using the area, while also providing an 'urban oasis'.
Apart from the economy, perhaps the only other hurdle to the early success of the project is its location. Kwun Tong, an area undergoing urban renewal that seems far removed from the chicness portrayed by developers marketing offices in certain island neighbourhoods.
Again, this doesn't deter Mr Chow and fellow defenders of Kowloon who say the district is already a well-established commercial area and that Winsor is far from being a pioneer there.
'What we are trying to do is actually drive the area another notch higher in terms of building quality amenities,' Mr Chow said. 'The challenge is that you always have traditional thinkers - it's just as Canary Wharf was in London and now perhaps TST. We are the new guys on the block and we have to be better to attract people.
'What we are trying to do [with Landmark East] is be the landmark in that area. We have 35,000 sqft of open space, so it's like having features that no other buildings can claim to have. There might be open space, but not as big as this.'
Connectivity was also a factor worked on from the early days when government authorities sought to have office towers complementing open space and enabling people to access public transport, dining and retail facilities via covered walkways linking commercial buildings.
'When the idea first came up, Kwun Tong was predominantly industrial,' Mr Chow said of the days before Landmark East appeared on the drawing board. 'So this was conceived to be an IO [investment opportunity] with very ordinary design. Suddenly our chairman asked why don't we do a best building to see if we can make the whole area more vibrant.'
Mr Chow said Landmark East represented about 70 per cent of his company's total asset and acknowledged that a lot rested on the investment. 'It's ... the first investment and development of its type for the company. When it's fully operational with a cash flow then it's also going to be substantially higher than the levels we are on now. So all the future of the company lies in the success of this development and any kind of future plan going forward is predicated on how successful we are with this one.'