HONG KONG, 21 April 2022 – Leading diversified professional services and investment management company Colliers (NASDAQ and TSX: CIGI) is pleased to announce it has been appointed as sole agent by KaiLong Group to sell the en bloc commercial asset 303 Jaffe Road and the nearby 41 private car parking spaces at Overseas Trust Bank Building, 160 Gloucester Road in Wan Chai through public tender. The tender closing date is 8 June 2022 (Wednesday).
Located in the core entertainment and F&B district of Wan Chai, 303 Jaffe Road has a GFA of 86,212 sq. ft. and recently underwent a HK$180 million renovation that was completed in early 2020. This prime 25-storey building offers buyers immediate rental income, with a high proportion of leased commercial space.
The ground floor retail space is currently occupied by a fitness centre and an upscale beauty salon, the first to the ninth floors are leased to a number of renowned restaurants while mid to high zone are leased out as office space. The building is equipped with three lifts and each standard floor has an area of about 3,200 sq. ft. with floor loading of 5Kpa and sufficient power to accommodate an increase in F&B tenants. Taking some Ginza-style commercial buildings in Wan Chai and Causeway Bay as reference, rent per sq. ft. is estimated to cost between HK$50-HK$80.
With units above the middle floors facing Victoria Harbour, the asset comes with approved rooftop signage rights, offering a prominent branding opportunity or an income stream through rental of the advertising space.
Creating a new upmarket entertainment destination
Ivan Ho, CEO, Hong Kong, China of KaiLong said: “We completed a HK$180 million two-year renovation with new facades, interiors and upgraded electrical and mechanical systems, transforming the former King’s Hotel into a landmark commercial building. Thanks to an occupancy rate of about 80% and many upmarket F&B tenants attracting white-collar and affluent customers, the property has established a strong revenue stream.”
Building on the development momentum across Wan Chai North
Wan Chai is a core business district and Wan Chai North is home to landmark commercial buildings, including Central Plaza, Sun Hung Kai Centre, Convention Plaza Office Tower and China Resources Building. Scheduled to commence service around mid-2022, Exhibition Centre MTR station will be the latest addition to the Island Line increasing connectivity to Wan Chai North, generating greater footfall and business opportunities that will add to the area’s development momentum.
Stanley Wong, Senior Executive Director Capital Markets & Investment Services said: “303 Jaffe Road is a prestigious destination for clientele with high levels of spending power. It offers sought-after dining experiences and private clubs located on high floors, creating exclusivity. The building is one of the most iconic Ginza-style buildings on Hong Kong Island, and offers an immediate rental income and gives buyers the chance to position themselves early as part of Wan Chai North’s future development.”
The pandemic has shifted the consumers’ consumption pattern on dining, resulting in a preference on upstairs dining room or private clubs among affluent segment. With the easing of the social-distancing rule and the launch of consumption coupon, there is a sign of recovery in consumption behavior. Currently, there are only a handful of en bloc commercial buildings for sale on Hong Kong Island and the asking price of newly-completed assets in Wan Chai is about HK$28,000 - $30,000 per sq. ft., 303 Jaffe Road presents a rare opportunity for investors. The building not only offers immediate rental income, but also future rental upsides with the upcoming Exhibition Centre MTR station. “It will attract the attention of long-term investors and also large companies and technology enterprises for setting up headquarters,” added Wong.
The sale also includes 41 private car parking spaces in the neighbouring office building, Overseas Trust Bank Building, which can be acquired collectively with 303 Jaffe Road, or separately.
Click here for more information on the property listing.