Henderson Land earnings cut in half amid downbeat Hong Kong property, retail markets

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The developer joins a club of its peers that have turned in poor first-half results, including Swire Properties, Wharf Holdings and CK Asset

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Henderson Land’s eponymous office tower The Henderson stands amid other office buildings in Central on July 28, 2024. Photo: Jelly Tse

Cheryl Arcibal

Published: 8:15pm, 21 Aug 2024

Hong Kong developer Henderson Land’s first-half earnings nearly halved as a subdued office property segment continued to weigh on office rents amid high interest rates, geopolitical tensions and a changing retail landscape, the company’s chairmen said.

Profit fell 47 per cent year on year to HK$3.17 billion (US$407 million), reflecting a fair value loss of HK$2.26 billion after revaluation of the group’s investment properties, Henderson said in a Hong Kong stock exchange filing after trading hours on Wednesday. Fair value loss in the year-earlier period was HK$116 million.

“Interest rates are expected to be adjusted downward in the second half of this year, which will bode well for the overall economy, as well as the property market in Hong Kong,” Peter Lee Ka-kit and Martin Lee Ka-shing, Henderson’s chairmen, said in a the filing.

Initiatives to connect the capital markets of Hong Kong and mainland China, as well as listings by leading mainland firms in the city, “will enhance Hong Kong’s status as an international financial centre over the long term”, they added.

The company joins a club of its peer developers and landlords that have turned in disappointing first-half results.

Swire Properties’ underlying profit fell 8 per cent year on year to HK$3.57 billion in the January to June period. Wharf Holdings swung to a loss of HK$2.63 billion from a profit of HK$696 million a year earlier. And earnings for CK Asset, the property developer of billionaire Li Ka-shing’s family empire, tumbled 16.7 per cent to HK$8.6 billion.

Henderson’s new namesake prime office building in Central, The Henderson, is “about 60 per cent let and has started to bring in rental income”, the company said.