Housing Authority announces Hong Kong's First REIT

The Housing Authority is to divest 180 of its retail and car parking facilities, which will form the portfolio of The Link Real Estate Investment Trust, the first REIT to be listed in Hong Kong.

Announcing the details today (November 24), Permanent Secretary for Housing, Planning and Lands Leung Chin-man said the divestment plan was the biggest privatisation of its kind in Hong Kong, and the largest single REIT Initial Public Offering in the world.

He said the divestment plan was a three-win formula for the Government, the real estate and financial markets, and the people of Hong Kong.

"It is an important milestone in the development of Hong Kong real estate and financial markets as the launching of the first REIT in Hong Kong will not only help enhance the status of the city as a global financial centre, but will also bring a new dimension to the real estate market.

"It will enable the Housing Authority to focus on its core business of providing subsidised public rental housing to people in need," Mr Leung said.

On completion of the global offering of units, the Link REIT will acquire the 180 Properties from the authority.

Of the properties, 149 are integrated retail and car parking facilities, two are standalone retail facilities, and 29 are standalone car park facilities.

If the global offering's over-allotment option is exercised in full, the Housing Authority will hold no residual units.

The Link REIT will hold Hong Kong's largest portfolio of retail and car park properties held by a single owner in terms of internal floor area (IFA).

The portfolio has an IFA of about 950,000 square metres of retail space, representing 9.1% of total retail space and about 79,000 car park spaces, representing 13.7% of total commercial car park spaces in Hong Kong.

End/Wednesday, November 24, 2004.