A scion of one of Hong Kong’s wealthiest families has acquired an 11-storey commercial building in Hong Kong’s core business district as local media accounts identify the buyer of 118-120 Queen’s Road Central as William Junior Guilherme Doo, a director of New World Development’s NWS Holdings infrastructure division.
Doo, who is a grandson of late New World founder Cheng Yu-tung, is reported to be paying anywhere from HK$280 million ($35.7 million) to HK$298 million for the 10,711 square foot (995 square metre) Ginza-style building leased primarily to F&B tenants and located just opposite The Center.
The son of New World Development non-executive vice chairman William Doo is braving Hong Kong’s most severe property downturn in decades to buy the property at between HK$26,141 to HK$27,821 per square foot, with trades of commercial assets having fallen by 50 percent in the second quarter of this year, compared to the same period a year ago, according to data from MSCI.
With Hong Kong still clinging to its COVID Zero strategy, dining businesses have been among the hardest hit with many businesses shuttered and rents for F&B premises in Central having slid 3.0 percent during the first six months of this year, according to data from Cushman & Wakefield.
Doo, now 48. is buying the property also known as the Luen Shing building from Toyo Mall, a property company controlled by the family of the late tycoon Lo Siu-Tong, who founded local developer Yu Tai Hing.
The Queen’s Road asset is said to currently earn monthly rental income of about HK$700,000, which is estimated to earn the new owner a yield of around 2.8 percent. The property occupies an approximately 1,261 square foot site about 500 metres (546 yards) from the Central MTR station, with the ground floor occupied by traditional medicine manufacturer Beijing Tongrentang, according to local media.
In a post on Twitter today, Savills took credit for brokering the transaction between the two local families, naming Allan Chan and Thomas See as the lead agents on the deal.
With the upper floors of the Luen Shing building occupied by office tenants, rents for Grade C desk space in Central have gone down by around 13 percent since the first half of 2019, according to Alex Leung, senior director at CHFT Advisory and Appraisal.
After years of social unrest and COVID-19 outbreaks, average office rents for space similar to the Luen Shing building have slid to around HK$32 per square foot of gross floor area per month, according to Leung.
During the same period, retail rents in the neighbourhood have declined about 25 percent on average, he added.
This latest en-bloc buy in Central sees the New World heir expanding his holdings in Hong Kong, with Doo having purchased the C Wisdom Centre, a commercial building on 35 to 37 Hollywood Road, also located in Central district, for HK$432 million in June of last year, per local media reports.
In May of this year, Doo sold the New China Laundry Building in the New Territories to Chicago-based fund manager Heitman for a reported HK$450 million.