Date
28 July 2017
Link REIT will add about 285,000 square feet of retail space to its portfolio after completing the acquisition of a property along Nathan Road. Photo: Link REIT
Link REIT will add about 285,000 square feet of retail space to its portfolio after completing the acquisition of a property along Nathan Road. Photo: Link REIT

Link REIT unfazed despite Mong Kok incidents, retail gloom

The Mong Kok clashes this month may have dented the confidence of some investors in Hong Kong.

The Hong Kong Association of Banks has issued a statement expressing concern over the violent protests that took place in the popular shopping area for visitors and gathering spot for locals.

It reminded Hongkongers how important social order and rule of law are to maintaining the city’s status as an international financial hub and retaining the faith of global investors.

Six major local trade associations including The Chinese General Chamber of Commerce and The Hong Kong General Chamber of Commerce also condemned the upheaval.

But barely a week after the incidents, Link Real Estate Investment Trust said it has purchased a property in the area for HK$5.91 billion.

“As a bustling 24-hour shopping and entertainment area, Mong Kok is served by an excellent transport network, and enjoys very high foot traffic,” said Link REIT’s CEO George Hongchoy.

The mall operator aims to turn the property at 700, Nathan Road into a Ginza-style commercial tower with retail and service theme.

Link’s move also came despite fears of a worsening retail slump due to falling visitor numbers.

The deal suggests that the company doesn’t expect the broader slowdown to weigh too much on the mass market and mid-tier segments it specializes in.

As seasoned investors say, going against the cycle and rushing in when others are too scared is one way to reap big rewards later.

Link is apparently not too bothered about temporary negatives, choosing instead to focus on long-term growth potential in local consumer spending.

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RC

EJ Insight writer

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