Gaw Sees Opportunity in Hong Kong’s Office Sector and More Asia Real Estate Headlines

Hong Kong’s property market may be heading into a rare slide but one of the city’s best-known property investors has one word for opportunity seekers – offices. That ray of sunshine from Gaw Capital chief Goodwin Gaw leads our real estate headlines from around the region today, as more gloom descends on mainland developers and Singapore’s Ascott opens the door to new opportunities in Indonesia. All the details on these stories and more await you in our daily roundup of the biggest real estate stories from around the region.

Gaw Sees Opportunities in Hong Kong Offices

Goodwin Gaw, co-founder of Hong Kong-based Gaw Capital Partners, is betting that growing concerns over the outlook for property in Hong Kong will yield some profitable opportunities in the commercial space. He believes there will be life in the island’s commercial sector for a few years yet, despite China’s economic slowdown.

Prime commercial offices on Hong Kong Island “will be in high demand for a sustainable period of time because there’s no supply,” he said recently in an interview with the Nikkei Asian Review in Bangkok. And there is still plenty of demand, he insists, from multinationals and local companies doing business with the mainland, as well as from Chinese companies seeking to expand abroad. Read more>>

Short Tenors, High Yields Become the New Normal of China Developer Bonds

China’s property developers are rushing to sell short-term dollar bonds ahead of record debt maturities next year, a move that analysts say would add to more refinancing pressure down the road.

Three issuers came to the market on Monday alone. Times China Holdings Ltd. is in the process of book building for a two-year bond with initial price guidance at 11 percent, while Greenland Holding Group Company Ltd. is taking bids for 1.5-year notes at low 9 percent area, people familiar with the matter said. A unit of China Evergrande Group is marketing a tap of existing notes due in 2020. Read more>>

HK Fintech Startup Backed by New World’s Cheng Heads for IPO

TNG FinTech Group Inc., a Hong Kong-based digital wallet operator, plans to seek as much as $300 million in a U.S. initial public offering, according to people familiar with the matter.

The company, whose investors include billionaire Henry Cheng’s NWS Holdings Ltd., is working with advisers on preparations for the proposed share sale, according to the people. It aims to start trading next year, the people said, asking not to be identified because the information is private. Read more>>

Ascott Links Up with Indonesia’s Ciputra

CapitaLand’s serviced residence arm, The Ascott, has formed a strategic alliance with Indonesian property developer Ciputra Development Group, under which Ascott will manage serviced residences to be developed by the latter in Indonesia and China over the next five years.

The first property, the 253-unit Citadines Sudirman Jakarta, will open in 2021. Ascott also recently struck a partnership with one of Indonesia’s leading hotel operators, Tauzia Hotel Management. These partnerships have helped Ascott grow its footprint to over 130 serviced residences and business hotels with close to 22,000 units across 39 cities in Indonesia. Read more>>

Condo Owners in SG’s Novena Area Try for S$146M Sale

Faced with the cooling en bloc market, Minbu Villa, a freehold residential development in Novena, is going up for tender at S$145.8 million again, but could see the reserve price lowered if 80 per cent of the owners agree.

Its earlier attempt this year was launched in March and closed on April 17 without a winning bidder.

This time, more than 60 per cent of the owners by share value and strata area have signed a supplemental agreement to lower the reserve price to S$129.1 million, translating to a land rate of S$1,355 per square foot per plot ratio (psf ppr). Read more>>

China Bond Covenants Sink to New Low Says Moody’s

Moody’s Investors Service says that the average covenant quality (CQ) score for Asian full-package high-yield bonds that it scored and which cleared the market in Q3 2018 was 3.36 (moderate), a level which is also a new record in weakness.

“The average quarterly score weakened for a second successive quarter to reach the worst average quarterly score in which at least two bonds were scored, and was also weaker than the previous weakest quarterly score of 3.16 (moderate), reached in Q2 2018,” says Evan Friedman, a Moody’s Senior Vice President and Head of Covenant Research. Read more>>

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