Swire Pacific, Wharf results dragged down by Hong Kong, China property markets

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Subdued office rentals hit Swire Properties, while sluggish residential sales do the most damage to Wharf

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Swire’s Two Taikoo Place rises above other buildings in the Taikoo Place complex in Quarry Bay, Hong Kong. Photo: Swire Properties

Cheryl Arcibal

Published: 4:28pm, 8 Aug 2024Updated: 5:59pm, 8 Aug 2024

Sluggish property markets in Hong Kong and mainland China are pulling down the bottom lines of the city’s largest companies, with both Swire Pacific and Wharf (Holdings) reporting less than stellar first-half results.

Swire Pacific reported a 7 per cent decline in first half profit to HK$3.91 billion (US$501 million), according to a filing with the Hong Kong stock exchange on Thursday.

Meanwhile, Wharf said it swung to a loss of HK$2.63 billion in the first half from a profit of HK$696 million in the same period in 2023.

The subdued office rental market hit Swire Pacific’s property unit Swire Properties, where underlying profit fell 8 per cent year on year to HK$3.57 billion. Meanwhile, sluggish homes sales did the most damage to Wharf, as residential-segment revenue in mainland China fell by 25 per cent to HK$2.5 billion.

Swire Properties, one of Hong Kong’s largest commercial landlords, cited “oversupply and weak demand” as twin challenges besetting the city.

“Amid an uncertain economic landscape, [corporations] are exercising caution in their real estate decisions,” said Guy Bradley, Swire Pacific chairman.