[Celebrity Property] The commercial building owned by actor Tony Leung Chiu-wai reduced rent for tenants, and the rental return is only 1.8%, which is worse than regular rent

The movie star who is known for his investment wisdomTony Leung, has also been affected by the recent sluggish business market, and its shopping malls have been forced to reduce rents to tenants. Among them, the high-rise unit of W50 commercial building in Wong Chuk Hang district, which he owns, was recently renewed to an asset management company at a monthly rent of approximately HK$54,400, a decrease of HK$141,000 from the old rent.

First-hand purchase

The unit is located on the 35th floor of W50 commercial building, with an area of 2,267 square feet. It was purchased by Tony Leung Chiu-wai from Sun Hung Kai Properties (0016) in 2014 in the name of his company, and it also came with two parking spaces. In April 2021, Tony Leung rented the unit to Gostone Capital Management, with the monthly rent at that time being approximately RMB 63,500.

However, the commercial building market has been weak recently, with the vacancy rate in the core area of Central as high as 10%, and the Wong Chuk Hang area is no exception. In the end, Tony Leung renewed his lease with Gostone Capital for one year at the end of May, with the monthly rent reduced to 54,400 yuan, a decrease of about 14% from the old rent, and the rent per square foot was about 24 yuan. Based on the purchase price of HK$35.408 million that Tony Leung Chiu-wai paid for the property, the rental yield is only 1.8%, far lower than the current general fixed deposit yield of more than 3%.

Rents fall

This situation reflects the current downturn in the commercial real estate market. Even Tony Leung, who has rich investment experience, can hardly avoid the pressure of falling rents.

W50 is a Grade A commercial building located in the heart of Wong Chuk Hang, Hong Kong, renowned for its prime location and outstanding architectural design. As a commercial building with dispersed ownership, W50 offers a variety of flexible leasing and sales options, suitable for companies of different sizes. Office units range in size from 500 square feet to an entire floor, meeting the diverse needs of start-ups, small and medium-sized companies, and even large enterprises. Whether leasing or purchasing, W50 can provide enterprises with an ideal office environment to help business development.

Further reading:

• A complete analysis of the financial crisis of Deng Chengbo's family: Market warnings behind the huge wave of property sales
• Hong Kong property market future analysis report: challenges and opportunities from a multi-dimensional perspective