Swire Properties Limited (“Swire Properties”) is pleased to announce that it has reached agreement with the Government of the Hong Kong Special Administrative Region (represented by The Financial Secretary Incorporated) (the “HKSAR Government”) to acquire its interest in Cornwall House in TaiKoo Place, Hong Kong.
The agreement provides for the exchange of ten floors of Grade A office space in Cityplaza Three (approximately 205,000 square feet of gross floor area) for all the areas in Cornwall House currently owned and occupied by the HKSAR Government, consisting principally of eight floors in the building (approximately 187,000 square feet of gross floor area).
The agreement includes a cash consideration payable to the HKSAR Government of HK$537million, and an additional amount to reflect any potential appreciation in office values between the date of the agreement and the date of completion of construction of the second phase of the TaiKoo Place redevelopment. In addition, Swire Properties will fund relocation costs and expenses for the existing HKSAR Government departments to vacate Cornwall House, including the fit out of the 10 floors of Cityplaza Three. The transaction is expected to be completed no later than 30 December 2016.
“This is an important transaction which will allow Swire Properties to proceed with our further transformation of TaiKoo Place through the redevelopment of three existing industrial buildings into two Grade A office towers,” said Martin Cubbon, Chief Executive of Swire Properties. “The two new buildings will provide about two million square feet of leading edge Grade A office space of the scale and quality that will enhance Hong Kong’s status as a regional and international financial and business hub.”
The first phase of the approved redevelopment plan of TaiKoo Place involves redeveloping Somerset House into a 51-storey office building; the second phase involves redeveloping Cornwall House and Warwick House into a single 46-storey office tower. The first new office building is expected to be ready for handover by 2018.
The redevelopment will provide a new landscaped square of approximately 69,000 square feet - similar in size to Statue Square in Central. A larger and more usable open space area will be created to benefit those who work in TaiKoo Place and the community as a whole.
“This redevelopment reflects Swire Properties’ long term commitment to Hong Kong by adding Grade A office space which will support Hong Kong’s economic development. In addition, we believe the addition of a significant amount of new open space will improve the quality of the local environment,” Mr. Cubbon added.