Li Genxing lost NT$8.82 million in the trap of "shop securitization"

The core of the storm: a complete analysis of the transaction of shop No. 126 Wusong Street

1. Trading Overview and Book Losses
   In April 2025, Li Genxing, founder of Shenghui Retail Fund,HK$18.68 millionSold the ground floor and loft shop at 126 Woosung Street, Jordan, compared to the purchase price in July 2022HK$27.5 million, the book loss is as high asHK$8.82 million (32%). The shop has a floor area of approximately 980 square feet, together with a 630 square foot attic, and is currently rented by a tenant at HK$75,000 per month, with a rental yield of approximately4.8 cmHowever, rental income still cannot offset the impact of asset depreciation.
2. Historical context: The painful cycle of being “cut in half” twice in seven years
   This is not the first time that the value of this shop has collapsed. The previous owner purchased the property in April 2015.HK$51.68 millionPurchased and held for 7 years until 2022 when it was resold to Li Genxing, the amount had evaporatedHK$24.18 million (46%), and Li Genxing's loss again means that the property has depreciated cumulatively since its peak.HK$33 million (64%), almost "cut in half and cut in half again". This case highlights the weak retail market after the epidemic, coupled with changes in policies and economic environment, which have increased the risks of shop investment dramatically.
3. Li Genxing's "First Blood": The First Loss Since the Establishment of the Fund
   Li Genxing has bought and sold more than 260 street shops since 2009. This is his first time to sell at a loss. It is also the first loss-making transaction of Shenghui Shop Fund since its establishment in 2016. He called it the "first drop of blood". This move not only reflects personal investment failures, but also indicates that the overall store market has entered a period of deep adjustment.

Market chain reaction: Shenghui Fund's "loss and sale wave" and the cold winter of the market

1. Five losses in two months, an average depreciation of 28%
   Li Genxing has accelerated the sales of his properties in recent months, and together with his shop on Wusong Street, he has accumulatedFifth Eclipse, total cash out is aboutHK$85.08 million, compared with the total purchase costHK$118 millionLossHK$32.92 millionThe average depreciation rate was28%. Other examples of eclipse include:

• Shop on Yin Hing Street, San Po Kong: Purchased at HK$21 million in 2021 and sold at HK$13.4 million in 2025, depreciation36%.
• Shop on Humphreys Avenue, Tsim Sha Tsui: Purchased for HK$20 million in 2023, sold for HK$17.3 million in 2025, a loss13.5%.
• Sai Ying Pun Water Street Shop: Purchased at HK$24.5 million in 2022 and sold at HK$15.6 million in 2025, a loss36%.

1. Both the livelihood area and the core area fell, and rental returns were difficult to support the market
   governmentRating and Valuation DepartmentData shows that the price of shops has fallen nearly 10% from the high level before the epidemic.40%, and Li Genxing pointed out that even if the core area rent is expected to rise3-5%, the shop prices in Minsheng District have bottomed out, but the overall market still lacks the momentum for a rebound. For example, although Shop 126, Wusong Street has4.8% rental return, it still cannot prevent prices from falling, reflecting investors' low confidence in asset appreciation.
2. Mainland buyers take over: market structure changes
   Among the five shops sold by Shenghui Fund recently,Four of them were taken over by buyers with mainland backgrounds, indicating that as local investors exit the market, mainland funds may take advantage of the low prices to buy Hong Kong assets. This trend may reshape the buyer structure of the shop market.

Deep-seated impact: structural problems behind the cold winter of the shopping mall market

1. Retail industry transformation and dramatic changes in consumption patterns
   The epidemic has accelerated the trend of online consumption replacing physical stores. Even if the tourism industry recovers, tourists' spending power will not be as high as before. Shops in traditional tourist areas such as Jordan rely on mainland customers, but the "one visa, multiple trips" policy has not been fully restored, resulting in a decline in both visitor flow and consumption.
2. Rising interest rates and financing cost pressures
   The global interest rate hike cycle increases the financing costs of holding properties, and shop investors need higher rental returns to offset interest expenses. However, the current shop rental level has not seen a significant recovery, further compressing the room for investment returns.
3. Policy uncertainty and owner mentality
   Policy risks such as the government's rate revaluation and rumors of rent control, coupled with owners' lack of confidence in the future market, have led to an increase in the number of properties listed and intensified price competition. For example, the Midland Confidence Index shows that attitudes towards shop listings tend to be pessimistic, which indirectly drags down transaction prices.

Market enlightenment under the eclipse tide

The storm of loss of shops on Woosung Street in Jordan is not only a single investment case, but also a microcosm of the transformation of Hong Kong's shop market. From Li Genxing's "exchange of goods for survival" to the entry of mainland funds, it reflects that market participants are repositioning their strategies. Under the dual pressure of structural adjustment in the retail industry and high interest rates, shop investment has changed from a "stable profit" to a "high-risk game". Only by accurately judging the regional potential, tenant quality and policy direction can we find hope in the adverse market.

Further reading:

• Huijing's three-bedroom apartment lost 3.13 million yuan in six years, and the depreciation rate exceeded the peak of the epidemic
• Another day! The son of "Shop King" Deng Chengbo, Deng Yaosheng, was sued by a financial company in the High Court for a huge debt of 230 million
• The crazy Deng Chengbo, the financially troubled agent, was so eager to set off firecrackers to pay tribute to the gods after receiving the commission!