Investor Lai Wing-to sees better retail rental returns in UK

Veteran Hong Kong investor Lai Wing-to has shifted his focus to the retail property market in Britain due to tightened mortgage loan conditions in Hong Kong.

One of the city's biggest individual real estate investors, Lai owns dozens of retail properties in Hong Kong.

He began to invest in Britain in 2010, when he spent some £38 million (HK$453.7 million) buying a commercial building at 221-223 Oxford Street, in London. But he says he is now taking a keener interest in such investments because they offer higher returns.

"The value of my building in London has doubled and monthly rents have increased by 30 per cent since I bought the property three years ago," said Lai.

Lured by the prospect of rising prices, Lai bought three stores at 527 Oxford Street for £38 million last December. Last month, he spent another £76 million on a five-storey retail building at 291 Oxford Street.

"In Hong Kong, you have to pay a stamp duty of 8.5 per cent when you buy a commercial property. But the taxation in Britain is simple. Foreigners need to pay a stamp duty of only 4 per cent, and profits tax is 20 per cent, which is a little higher than profits tax of 16.5 per cent in Hong Kong.