New World Development at 5-month low after co flags construction defects

MTR

09/07/2021 03:30

** Shares in Hong Kong developer New World Development
 0017.HK  fall as much as 5.5% to their lowest since Feb 16 
    ** New World is biggest percentage decliner in the benchmark
Hang Seng Index  .HSI 
    ** Stock also the biggest percentage decliner in Hang Seng
sub-index tracking property firms  .HSNP 
    ** Stock dropped nearly 4% on Thursday after New World said
it decided to demolish and rebuild the floors of two towers in
its best-selling joint development with railway operator MTR
Corp  0066.HK , The Pavilia Farm
    ** Concrete strength in sections of the wall base beneath
the two towers does not meet the requirements of the approved
design, the co said after an inspection
    ** The decision will result in a delay of about 9 months in
the occupancy date, and buyers can choose to complete or cancel
the transaction, both with an extra subsidy and mortgage
interest compensation
    ** Co says other towers in the development meet all relevant
legal and statutory standards for structural safety
    ** MTR down 1.2%, Hang Seng Index  .HSI  eases 0.7%
        

 ((clare.jim@thomsonreuters.com; +852 2912 6653; Reuters
Messaging: clare.jim.thomsonreuters.com@reuters.net))