Cheung Kei Group to buy office tower in Kowloon (South China Morning Post)

2016.07.19

Cheung Kei Group to buy office tower in Kowloon

Cheung Kei Group, the mainland Chinese conglomerate which last month spent HK$2.1 billion on a house on the Peak, said yesterday it had agreed to buyan office tower in Kowloon for HK$4.5 billion.

Cheung Kei is owned by Shenzhen tycoon Chen Hongtian whose purchase of a house at 15 Gough Hill Road in June set a record price for Hong Kong residential property. The purchase attracted further attention bacause no stamp duty was paid on the transaction, and because it was agreed that it would bepaid partly in cash and partly by the transfer of a commerical property in a non-core area of Shenzhen.

Before he bought the house on the Peak, Chen was little known in Hong Kong.

The Kowloon office development Cheung Kei will buy is the East Tower of One HarbourGate at 18 Hung Luen Road.

The deal includes a 15-storey office tower and two-storey retail villa, East Villa, which span areas of 254,000  square feet and 26,000 sq ft respectively.

As part of the transaction, Cheung Kei will also acquire naming rights to the building.

According to research from JLL, the number of mainland Chinese companies seeking to buy office space in Hong Kong has nearly doubled in the past fiveyears.

Another tower in the One HarbourGate development, the 15-storey west office tower, was bought by China Life Insurance (Oveerseas) for HK$5.85 billion in November last year.

Savills was the agent for both of the Kowloon office transactions.

When the East Tower is completed it will serve as Cheung Kei's headquarters.

In the case of the Peak residential purchase, Chen was able to avoid HK$170 million in stamp duty on the home by buying the company that owned the property, and so paid a share transfer fee instead.