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Sun Hung Kai Properties
Business

Outlook for major Hong Kong developers still gloomy as Covid-19 travel restrictions batter hotel, shopping mall businesses

  • Sun Hung Kai Properties, Hysan Development and Sino Land see profits at their hotel and shopping centre businesses tumble as travel restrictions keep visitors at bay
  • Analysts and industry executives see little relief on the horizon with no signs of borders being reopened any time soon

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Exterior of Four Seasons Hotel in Central. Photo: David Wong
Pearl Liu
There is still no light at the end of the tunnel for Hong Kong’s major property developers after a painful year in which their hotel and retail businesses took a particular drubbing, according to analysts and industry figures.
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Three of the city’s biggest commercial property landlords revealed sizeable falls in profit for 2020 as travel restrictions kept visitors at bay and brought the city’s economy to a virtual standstill.

“Various domestic and external challenges will continue to weigh on the economy of Hong Kong in the short term,” said Raymond Kwok Ping-luen, chairman and managing director of Sun Hung Kai Properties, the city’s biggest developer by market value, in an interim results filing to the stock exchange on Thursday.

The developer owns upmarket hotels like the Four Seasons, Ritz Carlton and the Hyatt Centric Victoria Harbour as well as luxury shopping centres including IFC Mall in Central.

“Shopping centre business will continue to be affected until the travel restrictions with the mainland are removed … hotel business is likely to remain tough as long as cross-border global travel is restricted,” Kwok said.

The company’s hotels recorded a loss of HK$228 million (US$29.4 million) for the year. That compared to profit of HK$197 million in 2019, itself a tough year as Hong Kong found itself mired in months of anti-government protests that hurt businesses.

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Hong Kong has practically shut its borders to tourist arrivals for the last year to contain the spread of the coronavirus, with no signs of normal travel resuming soon.

“As we enter the second month of 2021, we still have little clarity on our future,” said Irene Lee Yun-lien, who chairs Hysan Development, the biggest landlord in the city’s shopping district of Causeway Bay, in its annual results filing on Thursday.

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