Our core property leasing business across Hong Kong and the Mainland continued to be resilient against the backdrop of a challenging market. Rental revenue of Hang Lung Properties and Hang Lung Group was both up 3% after excluding the 6% year-on-year Renminbi (RMB) depreciation during 2016, but the rental revenue stayed flat when comparing like-for-like in the previous year.
Mr. Ronnie C. Chan, Chairman of Hang Lung Group and Hang Lung Properties, said, “We have achieved a robust rental performance, particularly respectable amid a tough economic climate and RMB depreciation. Taken together with the sales of residential units at the right time in Hong Kong, these results confirm the great appeal of our properties and the success of our efforts to choose the best course for our business through strategic planning and management.”
“The management has taken steps to protect our competitive advantage by carefully planning asset enhancement initiatives for our Hong Kong and Shanghai investment properties during an economic down cycle. We can already see favorable results in Hong Kong as the benefits of the completed asset enhancement initiatives continue to flow through. Our newer malls have made improvements by constantly monitoring and adjusting their tenant mix so as to strengthen our positioning and enhance customer experiences. These initiatives will further boost our competitiveness and profitability in the long run,” Mr. Chan added.
Rental revenue of our Mainland leasing portfolio for Hang Lung Properties and Hang Lung Group increased 1% and 2% to RMB3,416 million and RMB3,785 million, respectively. For our Hong Kong leasing portfolio, rental revenue of Hang Lung Properties and Hang Lung Group both increased 5% to HK$3,742 million and HK$3,899 million year-on-year, respectively.
During the year, Hang Lung has closely monitored the market and captured several favorable windows of opportunity to launch property sales in Hong Kong, including 436 residential units at The Long Beach, two semi-detached houses at 23-39 Blue Pool Road, one duplex unit at The HabourSide and the last two Carmel-on-the-Hill apartments. Benefitting from these much sought-after property launches, total revenue of Hang Lung Properties and Hang Lung Group increased 46% and 43% to HK$13,059 million and HK$13,648 million, respectively.
We continued to adopt prudent and comprehensive financial management strategies to maintain a strong financial position with a high degree of flexibility to meet Hang Lung’s capital commitments and long-term expansion.
We will continue to monitor the property market in Hong Kong and sell some of the residential units on hand and may further build our land bank when opportunities arise.
The Boards of Directors of Hang Lung Properties and Hang Lung Group have proposed a final dividend of HK58 cents per share and HK61 cents per share, respectively, to be paid on May 18, 2017, to shareholders registered as at May 5, 2017.