Interim Report 2015/2016
EXECUTIVE VICE-CHAIRMAN’S REPORT
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Furthermore, acquisition of over 80% ownership of 74–74C Waterloo Road and 15–25 Yau Moon Street in Ho Man
Tin has been completed under a joint-development old building redevelopment project that the Group has 51% stake.
This project has a site area of 10,682 sq ft. With reference to the government’s latest town planning, the expected
attributable residential GFA of this project upon redevelopment is approximately 49,000 sq ft. This project has proceeded
to the court for compulsory sale under the “Land (Compulsory Sale for Redevelopment) Ordinance”.
In January 2016, the Group won the development contract of Urban Renewal Authority’s Kowloon City Road/Sheung
Heung Road project in Ma Tau Kok. Located alongside the Kowloon section of the Shatin to Central Link of the MTR
under construction, the project has a site area of approximately 15,000 sq ft. Upon completion, the project is expected
to provide residential GFA of approximately 110,000 sq ft, about 216 residential units.
Hong Kong Investment Property
The excess demand for superior offices at prime commercial areas and the continual trend of China enterprises
establishing their presence in Hong Kong, have continued to provide sound support for the rental performance of Grade
A office buildings in Hong Kong. In November 2015, the vacancy of Grade A office buildings in Central dropped to 1.2%,
while the vacancy of Grade A office buildings in Hong Kong in general maintained at a low level of 2.9%.
For the leasing of retail shops, the retail market of Hong Kong has reached a critical point of structural adjustment, after
a period of stable development of local consumption under favourable economic sentiment and low unemployment
rate, following the change of mix of inbound travelers from Mainland China and their consumption pattern, and in the
aftermath of the spanking expansion of selected major international luxury brands in Hong Kong over the past years.
Vacancy rate of those retail shops at core retail areas has been rising, after the removals of certain high-end luxury
brands. For shopping malls, on the other hand, many landlords had in recent years proactively reviewed their projects,
enhanced the variability in physical facilities and reshuffled the brand and retail mix, catering for the changing consumer
taste and in turn stabilising the rental performance of the projects.
During the period under review, the Group’s gross rental income in Hong Kong amounted to HK$780.0 million,
representing an increase of 8%. The leasing projects also attained satisfactory occupancy. Tsim Sha Tsui K11, which is
located in a traditional core retail and tourism district, recorded an occupancy of almost 100% during the period under
review, with an average monthly pedestrian flow of approximately 1.4 million. As an international high-end artisanal
brand, a revolutionary museum with retail experience, K11 has been a popular spot for local consumers, with up to 80%
of its traffic from local customers. In order to uplifting the shopping experience, several new brands have been recruited
at Tsim Sha Tsui K11 in 2015.
For D•PARK in Tsuen Wan, a cross-border transportation hub in the western part of Hong Kong, the renovation works
were nearing full completion. Aiming at optimising its tenant mix, D•PARK will deliver a brand-new image under a new
logo, to signify a hotspot for pleasant enjoyment of family activities as well as a great place for shopping. To cater the
needs of local families and those young customers who are keen on tastes of living, tenant mix has been carefully
selected, including the exclusive introduction of E•LAND, the largest apparel group in Korea. In addition, 70% of the
stores in D•PARK incorporated kid elements to fully address the demand of children products.
Qianhai Chow Tai Fook Global Goods Shopping Center, which has been jointly developed by wholly owned subsidiaries
of Chow Tai Fook Enterprises, Chow Tai Fook Jewellery and New World Development, opened under its phase 1 and
started trial run in December 2015. Located in Qianhai, Shenzhen with a site area of approximately 11,000 sq m and a
total GFA of approximately 19,000 sq m, the project will be completed in two phases, with phase 1 occupying a total
floor area of 7,000 sq m and phase 2 occupying a total floor area of 12,000 sq m. An innovative shopping platform which
gathers online and offline resources and integrates smartness, shopping and recreation, Qianhai Chow Tai Fook Global
