HK property kings lose $60b amid double whammyBusiness | Bloomberg 11 Aug 2020
Hong Kong's real-estate tycoons have lost around HK$60.06 billion this year as their properties got hit by the double whammy of political unrest and a virus outbreak.
An index tracking the city's developers has plunged 21 percent, more than any other industry group.
At Peter Woo's Wharf Real Estate Investment Company (1997), retail rental income plunged by almost a third in the first half of the year, leading to a loss and a HK$7.4 billion hit to its portfolio.
Revenue from Hong Kong property sales at Li Ka-shing's CK Asset (1113) slumped by more than 60 percent.
The Kwoks' Sun Hung Kai Properties (0016) slashed rents for some tenants, while the biggest landlord in the Central district said its vacancy rate rose to 5 percent at the end of June from 2.9 percent in December.
With Covid-19 preventing tourists from coming and the national security law threatening Hong Kong's status as a financial hub, the fortune that property moguls have amassed is suddenly shrinking. To make matters worse for them, Financial Secretary Paul Chan Mo-po has urged landlords to offer tenants concessions on rents - some of the world's highest - to ride out the crisis.
Some developers that have yet to report first-half earnings have warned about potentially disappointing results. One of them is Merlin Swire's Swire Properties (1972), which said in June the company will post a substantial profit drop and a loss of about HK$2.6 billion on the revaluation of investment properties.
Overall, the city's vacancy rate for office buildings is at its highest in more than a decade while mall traffic is down by more than a third from a year ago amid stricter social-distancing measures to contain the spread of Covid-19.