HK's Li Ka-shing says property sales worst in 13 years

HK's Li Ka-shing says property sales worst in 13 years

HONG KONG - Asia's richest man, Li Ka-shing, says his business has suffered its worst year in more than a decade as measures to cool one of the world's most expensive real estate markets take their toll on Hong Kong's powerful developers.

"We only recorded about HK$4 billion ($$648 million) of property sales for the entire year, merely 15 per cent of the total sales in between HK$26 billion to HK$27 billion during the past two years," Mr Li told the Guangzhou-based Southern Metropolis Daily in an interview published on Thursday.

The billionaire octogenarian, who owns property company Cheung Kong (Holdings) and ports-to-telecoms conglomerate Hutchison Whampoa also sounded a note of caution over soaring land prices in Hong Kong and mainland China.

"Land prices are high in Hong Kong, and (we) have seen an unhealthy trend. Land prices in the mainland are soaring as well and we can't win the bids either," he added.

Mr Li has sold three major real estate assets in China so far this year, with the recently announced sale of an office project in Shanghai for US$1.16 billion, sparking speculation that he is retreating from the mainland property market.

In Hong Kong, the city's developers have been forced to offer steep discounts to offset higher stamp duties imposed a year ago to cool prices that have jumped 120 per cent since 2008.

Cheung Kong, the city's second-largest property company by market value, had achieved just 15 per cent of its Hong Kong contracted sales target of HK$30 billion with less than two months before the end of the year, Credit Suisse property analyst Ms Joyce Kwock said in a recent note.

Major rival Sun Hung Kais Properties in September posted a 14 per cent fall in full-year underlying profit for 2013, lagging forecasts and marking its first drop in annual earnings due to slow sales in Hong Kong.

Deutsche Bank forecast last month that Hong Kong home prices could drop up to 50 per cent in the next 12 months, while Barclays said the market will enter its first real downturn since 1998 with a 30 per cent plunge by 2015.


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