In a market that has started to see institutional investors step off the sidelines, we have seen overall investment activity become more active as stakeholders seek opportunities before the market rebounds. Freddy Wan of Capital Markets & Investment Services sees redevelopment sites as one of the major focuses among local and PRC investors, and on the retail front, the launch of Consumption Voucher Scheme will drive the market in the summer, says Cynthia Ng of Retail Services. Read the latest Weekly Snippet to find out more.
Redevelopment site opportunities come into focus
Over the last six months, we have seen investment market sentiment recover with redevelopment sites being a major focus for local, and PRC investors. Leaving aside the KITEC transaction, 25% of the total sales volume in this time frame has come from redevelopment sites, just 2% behind residential assets.
Investment sentiment in Wanchai and Causeway Bay has been the fastest to recover on Hong Kong Island. The pick-up in market sentiment for these two districts’ retail sector has been the most obvious, with total transaction volume for the first five months of 2021, exceeding the total from 2018.
Riding this market sentiment, Colliers Capital Markets & Investment Services team has been appointed as the sole agent for the disposal of a redevelopment site at 238-240 Wanchai Road. The site has already been approved for redevelopment into a 22-storey ginza-type building, and is located at the junction of Wanchai Road and Morrison Hill Road, which provides a heavy footfall of pedestrian. It also has good connectivity to major public transport links and is just a five-minute walk from Times Square in Causeway Bay. With multiple ongoing redevelopments in the vicinity, this property is a rare find and we expect the market show quick response. Click here to find more information about this property for sale.
Retail sector continues to depend on local consumption
The Consumption Voucher Scheme registration opened on 4 July 2021, which will see citizens become entitled to claim the first installment of the HK$5,000, from 1 August 2021. Around 5.54 million registrations have been recorded as of 14 July 2021 according to Government figures, showing that this Scheme is going to be popular, and adds impetus to the retail sector.
In response, we have seen shopping malls across the city roll out various promotional offers to drive foot fall. Examples can be seen with Wharf's Times Square, and Harbour City have launched Consumption Voucher Registration Rewards in collaboration with AlipayHK, Tap & Go and WeChat Pay, which goes live as of 5 July. The K11 Group is also partnering with WeChat Pay HK at K11's four shopping centres (K11 MUSEA, K11 Art Mall, D PARK, and THE FOREST) from 26 July and 26 September 2021. Local consumption remains a key focus of spending for this summer break and the remainder of H2 2021 amid travel restrictions in force.