London price tags close to home for mainland buyers in Hong Kong
Developers woo mainland investors with pricey London projects
With a depressed domestic market, Chinese developers are increasingly taking their rivalries offshore, with lofty ambitions matched by sky-high prices. Take the £50 million (HK$608 million) being sought for a London penthouse. If the price tag is close to home for buyers on the Peak, then so too is the trip to the sales office in Wan Chai.
Investors back home are firmly in the sights of mainland developers such as Reignwood Group, which is launching its 41-residence Ten Trinity Square on the site of the former Port of London Authority building in the City of London. But those keen on the 9,068 square foot penthouse, with views of the Tower of London and the River Thames, will have to wait. In the meantime, they can get their cheque books ready for other units in the project, the cheapest of which start from £5 million.
Reignwood, which is holding its Hong Kong exhibition until Wednesday, aims to sell five to 10 of the Ten Trinity Square units in the city.
"In Hong Kong, the exhibition is not aimed at just drawing Hong Kong buyers, it will attract mainland buyers as well," said Ni Songhua, the president of Reignwood Investments UK, adding the five-bedroom bedroom penthouse would be offered later.
His boss Yan Bin, the chairman of Reignwood, has made a name for himself with some high-profile business moves, including the distributorship of the Red Bull energy drink in China. He also has made himself the mainland's eighth-richest person, with an estimated US$14.2 billion, according to this year's Hurun Rich List.
Yan, in staking a claim on London's high-end market, is competing head-on with fellow mainland tycoon Wang Jianlin, the chairman of Dalian Wanda Group, who was ousted from the top spot on the mainland's rich list by Alibaba's Jack Ma Yun.
Wang's conglomerate earlier this month pitched its One Nine Elms project in London to Hong Kong and mainland buyers at an exhibition in the city.
Wanda last year bought the site near the British capital's new US embassy in its first foray overseas. The 1.13 million sq ft project comprises two residential towers with 439 flats - one of which will be central London's tallest residential building - and a hotel. It is due for completion in 2018.
The Trinity Square development also marks the first overseas venture for Reignwood, with total investment of between £450 million and £500 million.
"We are going to copy that not only in London, but in leading cities around the world. We may go to New York, we may go to Paris," Ni said.
Aside from the 41 homes, Ten Trinity Square will include a 100-room Four Seasons Hotel as well as members-only private club.
Reignwood bought Ten Trinity Square in 2010. The Grade II heritage-listed building was built in 1922. Ni said that given the protracted slowdown in the mainland market, Reignwood was targeting local buyers and private mainland companies looking for better investment opportunities overseas.
Shanghai-based Greenland Group plans to sell a development in Wandsworth, London, that will include more than 660 homes, shops, cafes, bars and restaurants. Prices start at £300,000 for a studio flat, with first completions from 2017.