Australian investment fund Allco has emerged as the front runner to buy Hongkong Land Holdings' grade A office building at 1063 King's Road in Quarry Bay, according to sources.
It is understood the investment fund and the developer reached a preliminary agreement last Friday.
Allco, formed in Sydney in 1979, has strong experience in property acquisition, fund creation and innovative financing techniques. 'It is probably the fund's first major foray into Hong Kong,' a source said.
With the latest market estimate of more than $5,000 per square foot, the 30-storey building would be worth about $1.5 billion to $1.6 billion.
If the deal goes through, it will be the biggest property transaction in the city this year.
'The building currently leases at about $28 per square foot. The rental yield will be lower than 5 per cent if the building is sold for $1.6 billion,' the source said.
