HK luxury-home prices may rise on shortage

Prices of luxury homes in Hong Kong, already the highest in the world, may rise further due to a lack of supply as an economic recovery spurs demand, property adviser and consultant Savills Plc said.

"There is no bubble ... we think the market is still on the upside, given that the Hong Kong economy has rebounded," Peter Yuen, Savills' senior director in Hong Kong, told reporters at a briefing yesterday.

Given that each residential project usually consists of one to three special units such as duplexes and penthouses, buyers, especially those from outside Hong Kong, will prefer to locate in such projects and luxury homes rather than in standard apartment projects, Yuen said.

Chinese customers make up about 15 percent of buyers of the city's residential property and 75 percent of total foreign purchasers, Frances Chow, Savills' director of Kowloon and New Territories residential sales, said yesterday.

HKMA sells HK$3.1b to keep HKD in trading band

Hong Kong's de facto central bank, the Hong Kong Monetary Authority, yesterday afternoon injected HK$3.1 billion (US$400 million) into the money market to stem an appreciating Hong Kong dollar and keep it within its fixed trading band. The Hong Kong dollar hit the top of its trading band at 7.7500 yesterday as a weak U.S. dollar and a jump in the Chinese yuan continued to encourage fund flows into the territory, dealers said. Hong Kong's peg to a weak US dollar made Hong Kong assets relatively cheap for overseas investors, while a rise in the Chinese yuan in the offshore non-deliverable forwards market enhanced the appeal of the Hong Kong-listed shares of mainland Chinese companies, they said.

Venetian Macau seeks $1.75-2 bln financing

Las Vegas Sands Corp is seeking $1.75 billion to $2 billion five-year financing for its subsidiary, Venetian Macau, almost one year after cancelling a $5.25 billion financing and mothballing its Macao projects, banking sources said. Funds from the new-money deal will be used to complete Lot 5 and Lot 6 of the Venetian Macau development, sources familiar with the matter said.

The new financing follows news of Las Vegas Sands' plans to launch a $1.5 billion-$2 billion initial public offering (IPO) in Hong Kong in November, and some bankers suggested that plans for a committed financing to complete the development could be a boost ahead of that fundraising.

The $1.75 billion to $2 billion deal is said to be split between a revolving credit and a term loan, both with five-year tenors, according to sources who said they had seen the information package.

CLP revenue fell 12% in first nine months

CLP Holdings Ltd, the biggest power supplier in Hong Kong, said revenue fell 12 percent in the first nine months because of government curbs on its returns in the city.

Sales declined to HK$37.6 billion ($4.85 billion) from HK$42.7 billion in the same period last year, according to a statement on the Hong Kong stock exchange Website yesterday.

Revenue in Hong Kong fell 10.3 percent to HK$21 billion.

CLP said in August there will likely be a "significant decline" in profit in 2009 because of a new electricity tariff system in Hong Kong. Under a government agreement introduced in October last year aimed at curbing pollution, the rate of return on fixed-asset spending by CLP was reduced to 9.99 percent from between 13.5 percent and 15 percent.

China Daily/Agencies

(HK Edition 10/21/2009 page4)