Exchange Square in line for $100m refurbishment

Hongkong Land is to invest $100 million in refurbishing and re-packaging the retail portion of Exchange Square Phase One and Two in Central.

The renovation, which comes soon after the completion of the refurbishment of the Princes Building shopping mall, is part of the group's upgrading programme of its property portfolio.

Norman Leung, retail leasing director of the company's Hongkong Land (Leasing) unit, said refurbishment work was expected to start in one or two weeks.

The work would involve improving the lobby and access to the building, which Mr Leung identified as one of its weaknesses.

'We want to create more decent entrances and bring about some natural lights in the lobby,' Mr Leung said.

The retail shops would also be re-packaged with more food and beverage shops, because the whole Central district was short of food shops, he said.

But the work would not change the size of the retail space for the building, which stood at less than 50,000 square feet.

Mr Leung said Hongkong Land was also looking to renovate the retail portion of Alexandra House.

The work was expected to be completed before 2002, when the redevelopment of Swire House, another of the company's prime properties, was completed.

Mr Leung said the renovation of retail shops might not have an immediate effect on rental income but would give the ageing properties a new lease of life.

Hongkong Land also increased its office portfolio with a newly completed commercial tower in a non-core district.

The tower, at 1063 King's Road, obtained an occupation permit on August 1 and is expected to generate rental income of more than $50 million per year when fully let.

Hongkong Land (Leasing) office leasing head Raymond Chow said the space for this building was 40 per cent committed.

Another 40 per cent of space was under negotiation and might be concluded soon.

He expected the office tower would be fully let within the next couple of months.

The building's nominal rents were around $16 to $20 per square foot, he said, adding that the rent-free periods were one to two months.

He said the company would talk to clients individually to finalise terms.

The General Electric Co of Hong Kong had committed to take up 36,000 sq ft, or more than four floors of the building, as the anchor tenant.

Market sources said Internet finance company Boom.com had also committed to take up another two floors of the building, but Mr Chow declined to confirm whether this was true.

He said the tenants for the King's Road building were mainly external clients, although some of Hongkong Land's existing tenants had also expressed interest in the tower.

Hongkong Land was not planning to offer naming rights to tenants of the building at present, he said.