Here’s proof that Hong Kong’s warehouses still attract private equity 

Learn more about some of the key deals. 

While a succession of rate hikes has deterred local investors and developers, Savills reports that private equity was still keen to acquire en-bloc and whole floor warehouses for investment. 

GLP made their first logistics investment in Hong Kong by purchasing the warehouse at 8-12 Tsing Tim Street, Tsing Yi from Swire for slightly over HK$1 billion. 

Here’s more from Savills:

Meanwhile, Goodman continued their recent venture into the strata-titled market by purchasing another floor in Sunshine Kowloon Bay Cargo Centre for HK$368 million, as well as paying HK$380 million for a 72% share of Chuan Kei Factory Building in Kwai Chung. KaiLong, on the other hand, purchased a 90% share of Wing Shing Industrial Building in Kwai Chung for HK$433 million, possibly with an eye to its redevelopment potential. 

The investment transaction volume of stratified industrial premises continued to decline due to the COVID situation, a stock market tumble and interest rate rises, with the entire third quarter recording 456 industrial transactions, a 26% QoQ decline. Both flatted factory and warehouse prices were stable over the quarter as a result. 

Outlook

Looking ahead, while new supply has been gradually taken up, uncertain business prospects are causing operators to become more conservative when making relocation and expansion decisions. With the 5.3 million sq ft CaiNiao Smart Gateway only one year from completion, many modern warehouse landlords will make retaining their larger tenants a top priority over the next six to 12 months.