Hong Kong Properties
Ronnie Chan, the chairman of Hung Lung Group, compared himself to Brad Pitt during a real estate conference in Hong Kong in December. “I am a man. Brad Pitt is a man. We aren’t exactly fungible assets. In the case of commercial real estate, I am Brad Pitt, ” he declared.
Chan was making a point that China is building far too many shopping malls, some of which are so big that a shopper will require more than a day to walk an entire complex. A veteran property developer and a billionaire, Chan welcomes a consolidation in the real estate sector in China. “In this business for one winner, there are 10 to 15 losers.” “Bankruptcy is a healthy thing. It is part of a process of concentrating the industry in a few hands and why not?” he asked.
In Hong Kong, Hang Lung’s home base, the real estate market is renowned for the fact that it is concentrated in the hands of a few. Among the 14 wealthiest real estate moguls in Asia, seven are from Hong Kong. The trial and the conviction of Rafael Hui and Sun Hung Kai Properties co-chairman Thomas Kwok showed up evidence of corruption and confirmed the widely suspected unhealthy links between government officials and Hong Kong property tycoons.
While rising property prices have enriched developers, many lower income families are struggling to own their own homes. According to government data, only about half of Hong Kong people own their own homes, compared with nearly 90% in Singapore, 67% in Australia and 85% in Taiwan.
Independent think-tank Liber Community Research said Hong Kong’s past three chief executives have failed to solve the city’s housing issue, in part because they had overly focused their efforts on leveraging supply. “We don’t think the three chief executives have very fundamental differences in their thoughts on the housing policy, ” it said in an email.