Daiwa Research has examined some of the various major property market transactions in HK over the past few years, and concluded that the HK property companies' prospects of realising their NAVs are now stronger than they were.
The research house said the monetisation of HKD10bn plus property assets no longer appears inconceivable, as we have already seen quite a few multibillion-dollar market deals over the past few years, with some exceeding HK$10bn.
Apart from capital from China, another important type of buyer is the sovereign wealth funds (Qatar Investment Authority), which recently bought an office tower in Singapore for US$2.5bn.
Hence, Daiwa is not surprised if more major deals in HK emerge over the next few months. A potential case would be "The Center", one of only a few iconic office buildings near to the coastline of Hong Kong Island.
Daiwa believes the arrival of more new capital in HK's physical property market would be an impetus to drive a further improvement in the capital management of the HK property companies.
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