Hong Kong developer New World Development Co., which is controlled by billionaire Cheng Yu-tung, has posted a 30 percent increase in underlying profit in the first half of the fiscal year, on the back of strong revenue from property sales.
The company said its net income, excluding property revaluations, surged to HK$2.35 billion (S$383.5 million) for the first-half of the fiscal year ending 31 December 2010, while sales increased to HK$15.08 billion, from HK$12.12 billion a year ago.
The company’s revenue from property sales rose to HK$7.51 billion from HK$2.75 billion in the previous year, while gross rental income in Hong Kong hit HK$766.3 million from HK$790.9 million a year ago.
Home prices in Hong Kong rose by more than 60 percent in the past two years, attributed to record low mortgages, an influx of mainland Chinese buyers and a lack of new housing supply.
“The economic rebound, low interest rate, ample liquidity and tight market supply have led to a robust growth in residential property transaction volume and price, starting (from) early 2010,” said Henry Cheng, Managing Director of New World.
Meanwhile, according to New York-based property services firm Cushman & Wakefield Ltd, prime office rents in Hong Kong, excluding taxes and service charges, jumped 51 percent to HK$139.50 psf last year and may rise by another 25 percent in the following year.