Hong Kong property developer New World Development (NWD) said lower rent income following a government plan allowing small firms to defer payments for up to six months will be offset by strong revenue in mainland China. The locally-listed developer’s interim underlying profit, excluding changes in the valuations of properties, rose 4.8 per cent from a year ago to HK$3.9 billion (US$499.4 million) for the six months to December, it said on Friday. Its revenue remained flat at HK$35.6 billion. It has proposed an interim dividend of HK$0.56 per share, same as a year ago. “I believe our lower rental income arising from this measure will be offset by our growth in rental income in China,” Adrian Cheng Chi-kong, NWD’s executive vice-chairman and CEO, said during an online results briefing. An unprecedented law designed to keep Hong Kong landlords from chasing tenants for falling behind on rent will apply to more than 19 sectors hit hard by the fifth wave of coronavirus infections , Financial Secretary Paul Chan Mo-po said on Thursday. The law will allow small and medium-sized enterprises in these industries, which include catering and retail, to delay rent payments from January for up to six months, Chan said. New World Development launches subsidised housing for lower income groups The government policy will affect NWD’s rent income, but the deferral will be valid for three to six months, Cheng said. After that, “tenants still have to pay rent”, he added. NWD’s China property business had recorded a strong performance. “We are confident that our underlying profit this [financial] year will see high single-digit growth,” Cheng said. Hong Kong developer pays US$165 million for stake in old buildings The company’s K11 Musea shopping centre in Hong Kong recorded a year-on-year increase of 21 per cent in sales during the period under review, whilst its total footfall amounted to around 12 million, with a year-on-year increase of 21 per cent, it said on Friday. NWD said it had offered rental concessions to individual tenants to help them to overcome the difficult times, but did not disclose any further details. “We always regard tenants as business partners. We must establish long-term and close relationships, and we will actively help tenants to promote, attract customers online and offline, and help them maintain business,” Cheng said. New World launches non-profit to pursue innovative housing solutions The developer also said that the fifth wave of the Covid-19 pandemic could cause uncertainty in the first and second quarters for the city’s property market. Hong Kong’s home price index dropped 1.14 per cent in January, its largest decline in 23 months, according to data released by the Rating and Valuation Department on Thursday. “But I do not think it will disrupt [our property sales] a lot, because the pandemic has been [around] for two years and the property market has remained stable. I am still optimistic about the market outlook,” Cheng said, adding that the company would continue to maintain its HK$10 billion sales target for the year ending in June. “We are confident we can achieve the goal for the whole year,” he said. A looming interest rate hike would have a bigger psychological impact on potential buyers. “When the pandemic is over, lots of purchasing power will be released,” Cheng said, adding that home prices would increase 5 to 10 per cent in the second half of this year. He expected the relaxation of mortgage lending to give a boost to flat sales, especially mass homes. New World Development’s Henry Cheng takes control of pay-TV firm i-Cable On Thursday, New World Development said that it had lent for free a 400,000 sq ft plot of land on Ma Shih Road in Fanling to the government to build a mobile hospital. Construction work had started, it added.