Swire Properties to offer rent waivers to Cityplaza, Pacific Place retail tenants

Waivers to run from beginning of government-ordered closures until April 20, part of ongoing tailored approach to assisting tenants affected by pandemic measures, company says
Financial Secretary Paul Chan Mo-po said on Thursday that city plans to allow small businesses in more than 19 sectors to waive rents for up to six months

Hong Kong property

Chad Bray

Published: 9:55pm, 25 Feb 2022

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Swire Properties, one of Hong Kong’s biggest retail landlords, said on Friday that it would waive rents for retail tenants forced to close because of emergency restrictions designed to stop the spread of the coronarvirus in the city.

The announcement came a day after Financial Secretary Paul Chan Mo-po said small and medium-sized enterprises (SMEs) in more than 19 sectors, including catering and retail, would be allowed to delay rent payments from January for up to six months under a new planned law.

Swire said it would offer full rental waivers to tenants forced to close in its wholly-owned shopping malls, Cityplaza and Pacific Place, from the onset of government-mandated closures until April 20.

“We are giving our full support to the HKSAR government’s anti-pandemic measures to help ride out the fifth wave of Covid-19,” Swire Properties CEO Tim Blackburn said.

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“In addition to offering some of our premises as quarantine and community isolation facilities, as well as vaccination and testing centres, we are continuing our collaborative approach with our tenant partners during these challenging times.”

Swire said it was also offering support to food and drink tenants who are facing reduced foot traffic and tailored support to other tenants on a case-by-case basis.

The company said it was one of the first developers to offer rental concessions to its tenants in 2019 following social unrest in the city and has continued to work with its tenants since then.

On Thursday, Link Reit, which operates more than 11 million sq ft of retail space in the city, said it was assessing the effects of the pandemic, with a view to expand its support for tenants in Hong Kong. The company said it has been providing HK$120 million (US$15.4 million) in support to its tenants since early February.

Central MTR station is quiet under tightened social-distancing rules amid the fifth wave of coronavirus outbreak. MTR Corporation is one of several landlords offering rental concessions to tenants. Photo: Nora Tam

“In view of the fast-changing epidemic situation and the latest control measures, our team is working tirelessly to revise our scheme, which began in early February, with the aim of expanding support to the tenants most in need,” Link CEO George Hongchoy said in a statement.

The company – Asia’s largest real estate investment trust – has been allowing tenants, based on their individual circumstances, to make rent payments by instalments, waiving late payment interest and charges, restructuring leases and offering some rent-free periods.

Swire, Link Reit and MTR Corporation, the city’s sole mass transit railway operator and owner of more than 2.7 million sq ft of lettable floor areas in its subway stations and shopping centres, previously said they would offer rental concessions to tenants affected by the coronavirus measures on a case-by-case basis.

The government plan to allow commercial tenants to defer rent is similar to measures adopted in Singapore and the United Kingdom over the course of the pandemic to help small businesses survive.

Unveiled as part of the city’s annual budget, the new law is expected to go before the city’s Legislative Council soon. It would be in force for three months and could be extended for another three.

The city recently extended its mandatory closures of 17 types of premises, including beauty parlours, fitness centres and cinemas, until April 20, causing further consternation for many business owners who have suffered the most from the city’s efforts to pursue a “zero-Covid” policy.