Cheung Kei Center Being Sold By Creditors For US$892mil

HONG KONG – With the liquidity crisis among mainland Chinese developers persisting, a mixed-use commercial property formerly owned by a business mogul has been launched for sale by creditors, reported Bloomberg on Monday noon (8 May, SGT).

The receiver of Cheung Kei Center, which consists of an office tower and two-level retail villa, has engaged real estate agency Savills to offload the asset via a tender that will close on 28 August 2023.

Notably, the commercial property was previously owned by Chen Hongtian, Chairman of Cheung Kei Group, a Hong Kong-headquartered investment company. Savills stated that the asset was appraised at around HK$7 billion (US$892 million) as of 2022.

Cheung Kei Group acquired the asset in December 2016 for HK$4.5 billion, then creditors seized the building in March 2023 after the investment firm defaulted on a loan.

The building contains 279,000 sq ft of commercial space and 155 parking spaces for vehicles. Previously called the One HarbourGate East Tower, it’s part of the One Harbourgate complex constructed by Wheelock Properties that was finished in 2016.

Apart from Cheung Kei Center, Chen also lost ownership of a high-end apartment and a mansion in Hong Kong to lenders.

Notably, there has been an increase in the number of assets owned by Chinese developers that have entered the market in the past few months. China Evergrande Group’s repossessed office building in Hong Kong has yet to secure a buyer since the 1st tender started last year, while Shimao Group Holding’s hotel close to the airport has been available since late March.

Cheung Kei Center’s tender came days after Chen told the South China Morning Post (SCMP) that his firm had the wherewithal to handle its “short-term liquidity issues” and was in talks with lenders to regain control of the three properties.