Hongkong Land Holdings Shifts Focus to Investment Properties

Hongkong Land Holdings has announced a strategic shift to focus on investment properties and fund management, reallocating HK$78 billion (US$10 billion) from residential development by 2035. This move aims to stabilize and enhance profit margins by transitioning to high-value integrated commercial properties in key Asian cities, with plans to double its profit before interest and tax (EBIT) and dividends per share within the decade. The company expects to raise $6 billion from asset divestments and will explore real estate investment trusts (REITs) to facilitate capital reallocation. CEO Michael Smith emphasized that this direction is a strategic pivot rather than a financial necessity, aiming for Hongkong Land to lead in the ultra-premium property market. The firm plans to diversify its geographical exposure, limiting any single city's profit contribution to 40%, and boosting its assets under management to $100 billion. This strategy follows a thorough review of its business direction, aiming for long-term growth amidst challenges in the residential sector.