Wednesday, July 17, 2019
 
Columnist
Martin Hennecke
 
HON KWOK LAND
HKEx Stock Code : 00160 
 
Corporate Profile
Principally engaged in property development, property investment and property related activities.

Business Review - For the year ended March 31, 2013

As disclosed in our Interim Report, on 18 September 2012, the Group entered into an agreement to subscribe for 20% interest in Chinney Trading Company Limited (“Chinney Trading”) at a cash consideration of HK$368,537,000. For details, please refer to the Company's circular dated 25 October 2012. The above subscription constituted a major and connected transaction for the Company and had been approved by the Company's independent shareholders. The above transaction was completed in February 2013 and thereafter, accounted for as investment in an associate in the financial statements. Chinney Trading, via its wholly-owned subsidiary, holds a development site situated at 中國深圳市南山區僑香路北側(Qiaoxiang Road North, Nanshan District, Shenzhen, PRC) and to be developed into a group of buildings for composite use with total gross floor area of approximately 224,500 sq.m. Substructure works are in progress which are expected to be completed in the next quarter followed by foundation and superstructure works.

On 31 December 2012, a wholly-owned subsidiary of the Company entered into a sale and purchase agreement for the acquisition of a villa located in Longgang District, Shenzhen, PRC from a wholly-owned subsidiary of Chinney Alliance Group Limited for a cash consideration of HK$9,383,000. The above acquisition constituted a connected transaction for the Company and was subject to the reporting and announcement requirements but was exempt from independent shareholders' approval. For details, please refer to the Company's announcement dated 31 December 2012. On 31 January 2013, the balance of the consideration was settled by the Group.

Property Development and Sales

Botanica Phase 3 寶翠園三期, Guangzhou, PRC

The Botanica 寶翠園, situated in the greenery zone of Tian He District near the Botanical Garden, comprises 39 blocks of high-rise residential building. This project, with total gross floor area of approximately 229,000 sq.m., is scheduled for development and pre-sale by phases. In the prior financial years, Botanica Phases 1 and 2 寶翠園一及二期, with total 16 blocks of over 750 units, had been sold out and delivered to individual purchasers. Foundation works of Botanica Phase 3 寶翠園三期, comprises 12 blocks of about 530 units, are in progress and expected to be completed by the end of this year.

Metropolitan Oasis 雅瑤綠洲, Nanhai, PRC

The whole project, with total gross floor area of approximately 273,000 sq.m., is situated in Da Li District, Nanhai and scheduled for development by phases. Phase 1 of the project comprises 71 units of 3-storey town houses of about 18,000 sq.m. and 24 blocks of high-rise apartments of about 121,000 sq.m. Construction works of the town houses have been completed whilst those of the high-rise apartments are in progress and expected to be completed by stages commencing in the financial year 2013/14 through 2015/16. The completed town houses together with four blocks of the above apartment units have been launched to the market for sale. Up to the date of this announcement, total contracted sales exceeded RMB180 million and profits derived from the delivered town houses have been recognized in the income statement during the financial year under review whereas those from the other sold units will be recognized in the forthcoming financial years.

Dong Guan Zhuan Road and Beijing Nan Road projects, Guangzhou, PRC

The development site at Dong Guan Zhuan Road, Tian He District are under planning stage. In respect of the project sites at 45-107 Beijing Nan Road, Yue Xiu District, design work is in progress.

Property Investment

Shenzhen, PRC

Hon Kwok City Commercial Centre 漢國城市商業中心, situated at the junction of Shen Nan Zhong Road and Fu Ming Road, Futian District, is being developed as an 80-storey commercial/office/residential tower with total gross floor area of 128,000 sq.m. Its superstructure works are in progress and completion of construction is expected to be in 2015. This signature building will be held by the Group for recurrent rental income.

City Square 城市天地廣場, situated at Jia Bin Road, Luo Hu District, is a 5-storey commercial podium. The retail areas at ground level and level 2 of the podium are fully let.

The average occupancy and room rates of The Bauhinia Hotel (Shenzhen) 寶軒酒店(深圳), a 158-room hotel at levels 3 to 5 of the above podium and City Suites 寶軒公寓, a 64-unit serviced apartments on top of it, both are maintained at a satisfactory level.

Guangzhou, PRC

Ganghui Dasha 港匯大廈, situated at the junction of Beijing Road, Nanti Er Road and Baqi Er Road, Yue Xiu District, is a 20-storey commercial/office building with current occupancy rate approximately 75%.

The Bauhinia Hotel (Guangzhou) 寶軒酒店(廣州), situated at Jie Fang Nan Road, Yue Xiu District, is a 166-room hotel leased by the Group. Its average occupancy and room rates are both satisfactory.

Chongqing, PRC

Chongqing Hon Kwok Centre 重慶漢國中心, situated in Bei Bu Xin Qu, is a completed 21-storey twin-tower office building atop of a 4-storey retail/commercial podium with current occupancy rate exceeding 95%.

Construction works of 金山商業中心 (Jinshan Shangye Zhongxin), adjacent to the above completed property, are well in progress. The whole project is scheduled to be completed by the end of this year. This twin-tower project, with total gross floor area of 133,502 sq.m., is being developed as a grade A office tower and a 5-star hotel plus apartments with a retail/commercial podium.

Hong Kong

The retail areas at ground level of the hotel/apartment building at Connaught Road Central and Des Voeux Road Central have been fully leased out except for two small shops.

The Bauhinia Hotel (Central) 寶軒酒店(中環), situated at four podium floors of the above building, is a 42-room boutique hotel. Its average occupancy rate exceeds 90% with satisfactory room rates. The Bauhinia 寶軒, a 171-room serviced apartments atop of the above hotel, has an average occupancy rate about 80%.

The Bauhinia Hotel (TST) 寶軒酒店(尖沙咀), situated at nine upper floors of a 23-storey commercial/office building at Observatory Court, Tsim Sha Tsui, is a 44-room boutique hotel with average occupancy rate about 85% and satisfactory room rates. Renovation works for conversion of ten lower floors of the above building into additional 54 hotel rooms are in progress and expected to be completed by early next year. Thereafter, the whole building will become a boutique hotel comprising a total of 98 rooms with the remaining floors as commercial use for rental income.

Hon Kwok Jordan Centre 漢國佐敦中心, situated at Hillwood Road, Tsim Sha Tsui, is a 23-storey commercial/office building with current occupancy over 95% at satisfactory rental rate.

Business Outlook - For the year ended March 31, 2013

The global economic uncertainties remain. Lingering recession in Euro Zone countries continued while U.S. economy only showed signs of tepid recovery. On the other hand, Mainland China's GDP growth has slowed in the preceding quarter; but inflation rate was maintained at a moderate level of 2.1% in May.

In Mainland China, the “New Five Measures” announced by the Central Government in order to cool down and ensure healthy development of property market appears not to restrain mainland economic growth whereas its impact on property market seems to be mild. However, further tightening measures could not be ruled out if market trends turn out to be undesirable. In view of urbanization momentum, improving domestic demand and relatively accommodative policy support, Mainland China''s economic growth looks sustainable.

In Hong Kong, the implementation of additional stamp duties coupled with mortgage control measures is expected to affect investment and high-end housing demands. Hong Kong Government is primarily aiming to stabilise property prices to avoid economic downturn.

Source: Hon Kwok Land Inv (00160) Annual Results Announcement
Chairman James Sai-Wing Wong Issued Capital (shares) 480M
Par Value HKD 1 Market Capitalisation (HKD) 1,590M
 
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