Hong Kong property investors have continued to put up assets for sale at a loss as a tariff war between the US and China escalates, unsettling a market that has already struggled to overcome years of distress.
Bridgeway Prime Shop Fund Management sold a ground-level shop at One Eighty in Shau Kei Wan for HK$20.1 million (87 million baht) on Tuesday, founder Edwin Lee said, implying a 20% loss. The fund paid HK$25 million each on average for two ground-level lots and a first-floor shop in the building in July 2023.
"The capital market will definitely be impacted by the trade war as investment confidence weakens," Lee said by phone on Thursday. "Just like developers, we cannot hoard our stocks and wait while the market continues to drop.
The fund, which focuses exclusively on shops and retail assets, would continue to buy and sell assets with good potential to maintain its liquidity, Lee added.
US President Donald Trump on Wednesday imposed a 90-day moratorium on higher tariffs against most of its trading partners except mainland China and Hong Kong. On top of that, he raised the total tariff on imports from China to 125% with effect from Thursday.
Beijing earlier raised its levy on all imports from the US to 84% and vowed to fight back against tariffs. Traders expect Beijing to step up its stimulus measures to support the economy.
Bridgeway last month sold a ground-level shop at Woosung Street in Kowloon for HK$18.7 million as the market remained depressed amid falling retail sales and high interest rates. The fund paid HK$27.5 million for the property three years ago, suggesting a 30% loss.
"Commercial real estate is likely to be negatively impacted, but within the sector, retail shops would be better off than offices as consumption improves," Lee said. "Mid to small residential flats will be supported by demand from talents and students."
Elsewhere, other investors have also been looking to offload assets as the tariff war and other fresh economic challenges cloud the path to further interest-rate cuts this year.
Patrick Kwok Ho-Chuen, co-founder of QF Capital and heir to Hong Kong cosmetics retail chain SaSa International, is selling a residential site at 54 Chung Hom Kok Road on the south side of Hong Kong Island at about HK$250 million, or about 24% below cost.
The vacant site presents significant development potential, allowing for the construction of a three-storey detached house, according to its sole marketing agent Savills.
QF Capital bought the site in 2021 and unified the ownership of the project for about HK$330 million, according to some local media reports. The fund's other projects include two industrial buildings, one commercial building and one residential site, according to its website.
