Hong Kong firm drops $1.4 bln land purchase pact on economic worries

Goldin Financial Holdings

11/06/2019 13:33

HONG KONG, June 11 (Reuters) - Hong Kong-based Goldin
Financial Holdings Ltd  0530.HK  has dropped out of a process to
buy a land parcel worth about $1.4 billion citing economic
uncertainties, as the Asian financial hub's businesses take a
hit from China's slowdown.
    In a rare move, Goldin said in an exchange filing on Tuesday
 its board had decided to exit the tendering process for land
use rights for a parcel in the Kai Tak area of Hong Kong due to
"recent social contradiction and economic instability".
    The firm, with interest in financial and property markets,
did not explain what it meant by social contradiction. Company
representatives could not immediately be reached by Reuters
after regular business hours. 
    Hong Kong's economy expanded at its slowest pace in nearly
10 years in the first quarter due to weaker exports and as the
former British colony was buffeted by the U.S.-China trade war,
along with cooling property prices and volatile stock markets.
    The government has maintained its forecast for Hong Kong's
full-year 2019 growth at 2-3%, compared with 3% growth in 2018.
 urn:newsml:reuters.com:*:nL4N22T2AU
    Despite economic weakness, home prices in one of the world's
most expensive property markets rose for the fourth straight
month in April, government data showed last month.  urn:newsml:reuters.com:*:nL4N2370Y7
    But analysts have said the rising price trend may not be
sustainable, especially as trade tensions between China and the
United States intensify again, leading to a plunge in
transaction volume.
    The trade tensions and its impact on the economy of Hong
Kong could hit the rental business of the planned Kai Tak
project, making the return period longer, said Thomas Lam,
executive director of property consultancy Knight Frank.
    
   ($1 = 7.8348 Hong Kong dollars)

 (Reporting by Sumeet Chatterjee and Clare Jim
Editing by Edmund Blair)
 ((sumeet.chatterjee@thomsonreuters.com; +852-2847 2094; Reuters
Messaging: sumeet.chatterjee.thomsonreuters.com@reuters.net))