Veteran investors are snapping up Hong Kong retail property assets in sign market slump is ending, Colliers says

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Local veteran investors accounted for all of the 15 major retail transactions in the third quarter, Colliers said, up from 20 per cent in the preceding three months

Volume has reached HK$22 billion this year through October 25, surpassing the HK$14 billion recorded in all of 2020 for deals above HK$100 million threshold

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People shopping in Mong Kok, Hong Kong on September 30. Photo: Sam Tsang

Lam Ka-sing

Published: 2:25pm, 24 Nov 2021Updated: 4:32pm, 24 Nov 2021

Hong Kong’s retail property assets are attracting a slew of domestic individual buyers, suggesting the year-long market fallout induced by the Covid-19 pandemic and recession may be bottoming out, according to industry experts.

Local investors accounted for all of the 15 retail transactions last quarter, according to Colliers International, based on deals above the HK$100 million (US$12.8 million) threshold. They made up only 20 per cent in the second quarter and 80 per cent in the first quarter, with corporate and institutional investors picking up the rest.

Investors including Chang Miguel Yen Shee and Larry Chan Tzuenn Man, “big spenders” who have kept a low profile over the last couple of years, have snapped up retail assets in some core locations, the property consultancy said in a report on Wednesday.

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Hong Kong-mainland border reopening hopes grow as Chinese experts review city’s Covid-19 measures

Investors are “attracted by the potential for capital value growth after the borders reopen next year”, it said in a report co-authored by Rosanna Tang, its head of research for Hong Kong and Greater Bay Area. “The return of these veteran investors suggests that the retail market is now close to the bottom of the cycle.”

Retail investment transactions have reached HK$22 billion this year through October 25, Colliers said, citing data from Real Capital Analytics using deals of the same threshold value. They amounted to HK$14 billion in 2020 and HK$30 billion in 2019.

Tang said that November and December are traditionally quiet months for the broader investment market in the city. Activity should continue to gather momentum next year, she added.

Chang, known in the local market for his Taiwan origins and plastics business, bought a prominent shop in Central’s Wheelock House occupied by Citibank for HK$710 million in August, Colliers said in its report.