P2 Wednesday, July 15, 2020 PROPERTY CONCRETE ANALYSIS ON THE MARKET FACTS & FIGURES Latest residential transactions Age Area Price Sq ft District Estate (years) (sq ft) (HK$m) (HK$) GROWING Mid-Levels Clovelly Court 26 1562 51.00 32,650 Convention Plaza Apts 31 619 19.00 30,695 Tai Hang Cavendish Heights 34 1439 43.80 30,438 38-34 988 16.00 16,194 33-42 689 12.28 17,823 NEED FOR Heng Fa Chuen 31-34 600 9.55 15,917 Apleichau 25-28 863 18.50 21,437 University Heights 24 401 8.58 21,397 Chi Fu Fa Yuen 39-42 588 7.98 13,571 Happy Valley Beverly Hill 32 1057 26.80 25,355 RESILIENT Aberdeen Aberdeen Ctr. 38-41 451 6.18 13,703 The 28-30 2450 75.00 30,612 Manor Centre 34 322 5.15 15,994 Cosmopolitan Estate 44-46 320 4.13 12,906 BUILDINGS Lai Chi Kok 42-52 467 6.52 13,961 Prosperous Garden 25-29 478 8.00 16,736 Kowloon Tong Beverly Villa 40 1211 17.30 14,286 Disasters, infectious disease and economic Yau Yat Chuen Village Garden 25 805 17.88 22,211 29-35 505 8.95 17,723 pressure have put a greater focus on both a Wong Tai Sin Tin Ma Court (HOS) 33 351 5.00 14,245 To Kwa Wan Wyler Garden 41-42 335 5.30 15,821 building’s attributes and property management Lam Tim 27-30 522 7.90 15,134 Richland Garden 35 447 5.75 12,864 Homantin,King's Park Chun Man Court (HOS) 39-40 519 7.17 13,815 undergoes digital transformation, Edward Farrelly Waterloo Hill,Perth St Perth Garden 40 994 17.30 17,404 [email protected] cybersecurity should be viewed as a key enabler of growth. Occu- Kwai Chung Wonderland Villas 34-36 813 9.90 12,177 piers are demanding more from Greenfield Garden 30-31 495 7.55 15,253 As real estate adapts to immense their space. A flight to quality will Tsuen Wan 36-37 445 7.35 16,517 change, it may be pertinent to emerge from this disruption as Seaview Crescent 17-18 568 7.68 13,521 Road 28-30 576 7.37 12,792 look back at what has happened, companies opt for offices that aid 24-29 1002 10.20 10,180 to prepare ourselves for what may greater productivity and serve to Siu Hong Court (HOS) 36-38 493 5.04 10,219 come. attract and retain the best talent. Palm Springs 26-27 1198 13.30 11,102 Real estate owners today, Resilient buildings, in the Sha Tin 29 578 9.44 16,332 grappling with falling revenues, broadest terms, covering all risks, Ma On Shan Sunshine City 26-27 369 6.32 17,122 are under intense pressure to both operationally and physically, Tai Po Parc Versailles 24 1005 10.00 9,950 contain costs and budgets have will be in greater demand and Kam Fai Mansion, Lam Tsuen River North Tai Po Centre 33-35 361 5.70 15,789 Fan Ling Flora Plaza 25 526 6.63 12,605 come under extra scrutiny. command the highest values. Mid-Levels Sheung Shui Sheung Shui Centre 27 342 5.20 15,205 However, rather than an However, can risks be foreseen On offer is a 1,254 sq ft Source: Centaline Property Agency, based on preliminary sale and purchase agreements arbitrary implementation of cost to increase preparedness and flat with one bedroom, a containment plans, property make assets more resilient? study, one bathroom and owners are advised to manage the The World Economic Forum one covered car parking Prime office indicative rents total cost of risk and identify cost Global Risks Report for 2019 space. The unit is on a high Prime office asking rents (HK$ per sq ft) – as of end June 2020 savings from a risk management highlighted the increased floor of the 58-year-old perspective. frequency of disease outbreaks, building. HK Island (Figures in net floor area) Within risk management, the erosion of important Asking price: HK$28 million Admiralty Centre (Tower I & II) 68 (Tower I) 43 resilience is a critical component governance systems and proto- Agent: Melanie Krepp in making a building, and cols, a greater threat posed by an (6698 7740) of Okay.com 68 Lippo Sun Plaza 51 companies, more functional and “innovative” pandemic and One & Two Pacific Place 127 Ocean Centre 52 productive. Actions to improve increased vulnerability to societal building resilience make and economic impacts. Bank of America Tower 73 26 96 economic and financial sense. In particular, it highlighted a Tower 138 The Gateway (Tower 1) 59 When “roll-call of near-miss catas- Exchange Square 150 The Gateway (Tower 6) 68 passed through our part of the trophes” since 2000 and weak- region in 2018, it left behind US$3 nesses in preparedness to detect, 130 International Commerce Centre 100 billion in economic losses and assess, report and respond to One International Finance Centre 175 Tower 1 51 US$900 million in insurable acute public health threats. losses. Today, the economic The report also contained a Two International Finance Centre 185 impact on real estate from the survey, the Global Risks Per- (Gloucester Tower) 137 current pandemic is also clear. ception Study, assessing both the More than 40 per cent of notified likelihood of a risk occurring The Landmark (Edinburgh Tower) 137 insurance claims due to Covid-19 globally within the next 10 years have come from real estate. and its negative impact. Rents for homes Average rents in Of note among the results for Average rents of 100 housing selected districts the 2019 and 2020 editions of the estates (HK$ per sq ft of study is that the spread of Rents (HK$ per sq ft of gross floor area) gross floor area)* infectious disease did not rank North Point Resilience among the 10 most likely risks in 31 Quarry Bay / Taikoo Shing either year. This is not to say that Chaiwan / is a critical the risk was not taken seriously, Aberdeen / South Horizons but rather that participants per- component ceived more pressing concerns. 35 29 There are many reasons in making a individuals, companies and building ... governments may fail to act when 32 faced with evidence of a possible more functional threat, such as how scarce 27 resources are allocated and possi- 29 The losses real estate has ble first-mover disadvantage. * Provisional figure suffered from these events arises It is conceivable that a com- from property damage and busi- pany allocating capital to mitigate Jun 18 May 20* May 18 May 20 ness interruption. As occupiers some less tangible risks could be become more risk-aware, greater penalised in the short term Midland property price Property sales activity focus will be placed not only on relative to its peers by investors. index (’000 transactions) building attributes, but also on However, I would also argue that Hong Kong regional price indices property management. How these companies are also better 11 Last: 8,254 effectively a building is managed placed to achieve higher risk- Overall Hong Kong Kowloon will certainly interest insurers. adjusted returns on a consistent New Territories The risks posed by extreme basis. weather events and infectious Certain characteristics of our 200 9 disease have evidently not gone cognitive functioning may also away, while others are now more dictate or shape our lack of action. Glamour Court, Pok Fu Lam relevant than before. Cyber risks Tim Harford, writing in the This 1,232 sq ft penthouse has three bedrooms with 180 have become greater as demand Financial Times about “Why we one en suite and two bathrooms. It also has a 1,113 7 has risen for technological fail to prepare for disasters”, sq ft roof and two covered parking spaces, plus one solutions across the real estate identifies some key behavioural uncovered car parking space. spectrum. The digitalisation of characteristics that may be at play Asking price: HK$25 million 160 5 real estate, driven by the smart – normalcy bias, herd instinct, Agent: Christine Chong (9648 6082) of building concept and the use of egotistical optimism, exponential Landscope Christie’s International Real Estate robotics, artificial intelligence and myopia and wishful thinking. internet of things, presents addi- In the Global Risk Perception Jul 16, 18 Jul 13, 20 Jun 18 Jun 20 tional exposure for stakeholders. Studies, extreme weather events Cyberattacks pose a threat to and the failure of climate change network infrastructure, business mitigation and adaptation were Average Price of Secondary Residential Property continuity and data integrity. The rated the risks most likely to occur, in major cities potential cost of an attack has also and in the top three for their risen due to the burgeoning potential negative impacts. Beijing Shanghai Guangzhou Shenzhen privacy regulatory environment. Survey respondents certainly 100,000 In real estate, where information cannot be accused of a lack of is often exchanged across awareness of these issues. 90,000 different jurisdictions with differ- With more information at our ing regulations, implementing disposal, property owners, 80,000 effective data protection controls occupiers and investors can make into daily operating procedures is better-informed risk-adjusted 70,000 a major challenge. decisions. The outcome is likely to 60,000 The shift to remote working for be greater demand for resilient, RESIDENTIAL many companies also increases well-managed buildings. 50,000 the need for close alignment between people, processes and Edward Farrelly is senior 40,000 technology to enable controls vice-president, real estate Developer bullish as queries jump for across all the three pillars and industry leader Asia, at Marsh Apr 18 Mar 20 mitigate the new emerging risks. luxury flats next to Buckingham Palace In fact, breaches resulting from > CONTACT US (yuan) general human errors or social Telephone the property news China property price desk on 2565 2237, fax us on Average No of Average No of engineering account for more Bloomberg impact the availability of stock, demand to be underpinned by than 90 per cent of cyberattacks. 2565 1624 or email us at which in turn will limit stock and Britain’s offer to provide British Shanghai price units sold Beijing price units sold As the real estate industry [email protected] push up demand.” National (Overseas) passport Lake Ville 160,000 130 Color Cloud 69,000 182 The developer of luxury flats next Northacre’s optimism comes holders living in protest-hit Hong Phase 5 to Buckingham Palace is hoping it as broker Savills warns prices in Kong with a path to citizenship. Shanghai Lijing 97,000 94 Royal Mansion 61,000 518 can defy predictions of a slump in London’s wealthiest districts will Buyers from Hong Kong and upmarket London properties. decline by 2 per cent this year as the mainland made up “10 per Sheshan Riviera 60,533 5 Wonder Land 57,000 86 Northacre, which is develop- the lockdown to prevent the cent to 15 per cent of the appetite Jinxiuyulan 59,800 122 Campus One 45,000 78 ing No 1 Palace Street in St James’ spread of the coronavirus for prime central London”, Park and The Broadway in discourages overseas buyers. Kheriba said. Cloud Villa 36,000 95 Jinmao Beijing 31,700 250 Westminster, had seen inquiries Still, Northacre expects The company is also seeing international community surge almost threefold in the first interest from India, Nigeria and half compared with a year earlier, Gulf countries. Average No of Average No of director Mustafa Kheriba said. “Inquiries in general have Shenzhen price units sold Guangzhou price units sold “The global pandemic will been much more focused,” Jingling Jiari 90,000 347 City Gather 51,000 181 only increase demand,” said Kheriba said. “Buyers have had Kheriba, who is also deputy chief Buyers have more time to dedicate to their Ultimate 68,000 1000 Blue Bay 36,500 85 executive and head of asset and had more time property purchase. Having spent wealth management at Dubai’s months within the same four Jinshun Xingyuan 52,600 58 Shanhai 24,000 20 liancheng Shuaa Capital. to dedicate to walls, they are also much more Royal Mansion 51,000 393 Hesheng Hushan 21,500 50 “This, coupled with the their property specific in terms of their needs changing environment for and requirements.” Zhaoshang 31,000 10 CRCC 21,000 19 property development, with a purchase Northacre generated £60 Dongan International Mansion Resilient buildings that cover all risks, both operationally and shrinking workforce following million (HK$587 million) of sales physically, will command the highest values. Photo: Robert Ng Britain’s exit from Europe, will MUSTAFA KHERIBA, NORTHACRE from the developments last year. Sources: CBRE, Midland Realty, Land Registry, Centaline China SCMP