ACN Realty Advisors has closed its offices in the Far East Finance Centre in Hong Kong and consolidated operations in Beijing and Shanghai. Managing director Nelson Wong said that when he decided to close the Hong Kong operation last month, it had incurred about $1 million in debts. The office employed 30 people. ACN is the latest of a host of smaller agencies which have been forced to close due to the economic downturn. Larger agencies such as Midland Realty and Centaline Property Agency have trimmed street-front operations substantially since the crisis hit last year. ACN, which was established in 1996, ran into financial problems after office deals in Sheung Wan and agricultural land sales in the New Territories failed last year, with buyers defaulting. 'We lost a lot of commissions on the agency side,' said Mr Wong. He said the Hong Kong office was closed to limit financial losses and he had resisted approaches by Hong Kong developers which he said were keen to take a stake in his business. 'I don't think professional companies like ours should be owned by developers,' he said. 'There is going to be a conflict of interest.' According to Mr Wong, all SAR operations - including luxury residential and commercial agency work, as well as research and investment divisions - have suffered. The commercial and investment markets had all but dried up and he estimated returns dropped by 80 to 90 per cent on property investment. Luxury residential commissions suffered because expatriate workers were receiving lower housing allowances. 'Fewer people have been coming to Hong Kong, so the residential sector has suffered,' he said. Mr Wong said he closed the operation before debts jeopardised operations in Guangzhou, Beijing and Shanghai. 'We aren't like the big boys in town who can always rely on property management, valuation or consultancy work,' he said. Mr Wong said the Beijing and Shanghai offices were profitable, with costs about two-thirds of Hong Kong's. An office in Guangzhou also had been closed because the property market was too volatile, said Mr Wong. In Beijing, the firm formed a partnership with an investment consultancy and has doubled office staff to 30. It also employs 500 people managing buildings around the capital. Its management contracts include the 93-unit luxury Woodland Villas, developed by Beijing Land. In Shanghai, Mr Wong said the company was seeking a joint-venture partner to take a 10 to 20 per cent interest in ACN, which helped developers market their properties. Mr Wong said the Beijing and Shanghai office markets were suffering from oversupply, with rents and prices expected to fall further. Despite concerns about a slowing economy and a possible devaluation of the yuan, Mr Wong said ACN's operations were expanding. 'There are areas of growth in this market,' he said. 'In real estate nobody is providing people with the information they need.'