Hysan eyes more Hong Kong residential projects amid subdued retail sector
Hysan Development, one of the largest landlords in the shopping district of Causeway Bay in Hong Kong, will continue looking for opportunities to raise its stake in the residential market, the company’s management said on Friday.
The owner of several major shopping malls last year made its first residential land purchase in nearly 20 years as the city’s retail sector took a downward turn.
In November, Hysan, along with land developer HKR International, was awarded two residential sites in the northern Tai Po district for a total HK$3.39 billion.
Ricky Lui, Hysan’s chief operating officer, said the project reflected the company’s standards in selecting residential land investments.
“It’s a high-quality area near the border between the mainland and Hong Kong. It’s of low density, and we have the partnership with HKR International,” he told reporters.“I think that’s our direction.”
Lui said the company would not restrict itself to one place when looking for residential projects.
But the executives said Hysan has no plans to shift its focus away from Causeway Bay’s shopping district, despite a challenging retail environment.
Speaking to media on Friday, the chairman Irene Lee said the management was satisfied with improved foot traffic at the shopping centres during the Lunar New Year holiday.
Lee said this year’s retail market would be “stable but challenging”.
“The macro environment is not easy to control,” she said. “There are global political factors. Hong Kong also has its own politics.”
“The most important thing is our own business operations. We have been trying to diversify (the retail portfolio) and improve the shopping experience.”
Hong Kong retail sales were down 5.5 per cent year-on-year in November, the 21st straight month of declines, according to the latest government data.
However, sales in department stores were up 1.7 per cent in November, the first year-on-year growth in 18 months.
Hysan’s new office building, Lee Garden Three at Causeway Bay, is due to be completed at the end of this year.
A few tenants have committed to their leasing, according to Jessica Yip, director of office and residential at Hysan Development.
Yip said an increasing number of large corporations were exploring office space in Causeway Bay, with the supply in the financial district of Central still falling short of demand.