Swire Properties to spend HK$10b on Taikoo Place redevelopment

Swire Properties will spend HK$10 billion over the next few years to turn three industrial buildings in Quarry Bay's Taikoo Place into two grade A office towers, making it one of the company's biggest investments in a project in a decade.

The listed property unit of Swire Pacific said the redevelopment would see Somerset House, Cornwall House and Warwick House turned into two new grade A office buildings, generating a gross floor area of two million square feet.

Based on an estimated construction cost for commercial projects of HK$5,000 per square foot, the construction cost would be at least HK$10 billion, Swire Properties chief executive Martin Cubbon said.

Cubbon unveiled the investment amount yesterday after the company announced an 8.5 per cent decline in its underlying profit to HK$6.35 billion last year.

Net profit, including lower revaluation gains on investment properties, dropped 33.2 per cent to HK$12.53 billion.

Operating profit from trading of properties fell 56.8 per cent to HK$1.04 billion because of fewer sales of units at the Azura development in Mid-Levels.

Gross rental income rose 7.3 per cent to HK$9.68 billion.