Hong Kong-based property developer New World Development Limited has just managed to sell two more non-core assets for HK$3.57 billion or roughly $460 million. The sale is the latest asset liquidation conducted by the company as part of its long-term development strategy, which involves a shift in its focus to its assets in the cities located in China's Greater Bay Area.
In a statement released on Monday, New World revealed that it had managed to sell its 45 percent stake in several properties located at the Sun Tak Center in Sheung Wan for HK$2.36 billion. It also managed to rake in an additional HK$1.21 billion after selling its Eight Kwai Fong apartment building in Happy Valley.
The company, which was founded in 1970 by Cheng Yu-tung, stated that the sale of the non-core assets is part of its business optimization and long-term core development strategy as it shifts its focus on its businesses in cities located in the Greater Bay Area. Since the start of its financial year, which began on July 1, 2019, the company has managed to dispose of assets worth more than HK$10 billion.
According to New World, the capital raised by the non-core asset sales will be used towards developing its core businesses in its target markets. This will include heavy investments in properties and business within the 11 cities of China's Greater Bay Area, namely in Zhuhai, Foshan, Huizhou, Guangzhou, Zhongshan, Shenzhen, Dongguan, Jiangmen Zhaoqing, and the two special administrative regions, Hong Kong and Macau.
New World previously stated that its target asset disposal amount would be around HK$15 billion for the short to medium term. The company did not elaborate on the exact assets it will be putting up for sale as part of its strategy. In its latest annual report, around 38 percent of the company's HK$251 billion worth of fixed assets is located on the mainland. The company operates a number of residential and commercial properties, including department stores, hotels, and condominiums.
As for its latest investments, the company recently joined a number of major Hong Kong developers in the bidding for a residential property in Ap Lei Chau in the city's southern region. Around 19 developers, including top companies such as Sino Land, CK Asset Holdings, and Sun Hung Kai Properties, had joined the bidding held by the city's Land Department last month. The market value of the 12,150 square foot piece of land is estimated to range from HK770 million to HK$1.6 billion.