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SHKP signs HK$15 billion syndicated credit facility

2016-03-10

SHKP Chairman and Managing Director Raymond Kwok and bank representatives at the HK$15 billion, five-year syndicated loan signing
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SHKP Chairman and Managing Director Raymond Kwok and bank representatives at the HK$15 billion, five-year syndicated loan signing

Sun Hung Kai Properties Limited (SHKP) announced the signing today of a five-year, HK$15 billion syndicated credit facility with a consortium of 17 leading international and local financial institutions.  The loan will be used as general working capital for future business development.

The facility was signed by Sun Hung Kai Properties (Financial Services) Limited and guaranteed by SHKP.  It has a 30:70 split between term-loan and revolving credit tranches, and a maturity of five years at 88 basis points over HIBOR.  SHKP has steadfast support from the banking community and the facility was oversubscribed from HK$5 billion to HK$18.7 billion with a final tally of HK$15 billion.

SHKP Chairman and Managing Director Raymond Kwok said at the signing ceremony: “We received an overwhelming response from the banks and this is a clear sign of their great trust and a very strong vote of confidence in our Group.  SHKP’s about 10-million-square-foot office portfolio in Hong Kong encompasses prime locations in various business districts, including the prestigious International Finance Centre and International Commerce Centre, which continue to attract keen interest from quality tenants.  Its overall occupancy stayed high at 96%.  Our retail portfolio covering over 10 million square feet has also performed well and achieved an occupancy of about 96% despite a challenging operating environment.  Our Hong Kong investment property portfolio generated over HK$8.2 billion in gross rental income in the first half of this financial year.”

Mr Kwok added that the recent launch of Twin Regency in Yuen Long received a positive market response.  Additionally, earlier launches of Ultima Phase I in Ho Man Tin, Century Link II in Tung Chung, King’s Hill in Island West and Park Vista 1A in Yuen Long also posted satisfactory sales.  Together with good sales results of our mainland projects, our total contracted sales has amounted to about HK$17 billion so far for the current financial year.

On the mainland, SHKP has an investment property portfolio of about 12 million square feet in attributable terms, producing gross rental income of over RMB1.4 billion in the first half of this financial year.  Shanghai IFC and Shanghai ICC are signature projects in the city, and their office space is the preferred choice of major tenants.  IAPM mall in Shanghai ICC and IFC Mall in Shanghai IFC are two of the major contributors to rental income, and will continue to generate sizable recurrent income for SHKP over time.

Mr Kwok also said that SHKP has obtained cash proceeds of over HK$16 billion from the exercise of bonus warrants since April 2014.  With abundant cash flows supported by growing recurrent income, healthy property sales, a strong balance sheet with low gearing at 12.4% and seasoned management, SHKP is well positioned to capitalize on future business opportunities.

The loan facility has the following coordinating arrangers: Bank of China (Hong Kong) Limited, The Bank of Tokyo-Mitsubishi UFJ, Ltd., DBS Bank Ltd., Mizuho Bank, Ltd., Sumitomo Mitsui Banking Corporation, Bank of Communications Co., Ltd., China Construction Bank (Asia) Corporation Limited, Industrial & Commercial Bank of China (Asia) Limited, The Hongkong & Shanghai Banking Corporation Limited, Hang Seng Bank Limited, Oversea-Chinese Banking Corporation Limited, Sumitomo Mitsui Trust Bank, Limited, United Overseas Bank Limited, Australia & New Zealand Banking Group Limited, BNP Paribas, Citibank, N.A. and Crédit Agricole Corporate and Investment Bank.

SHKP conducts businesses in an open and responsible manner and follows good corporate governance practices by maintaining timely and effective communications with shareholders and investors.  It is a socially responsible company that contributes to Hong Kong by promoting reading and holistic development and healthy, sustainable lifestyles, as well as helping the less fortunate.  SHKP currently has the highest credit ratings among property companies in Hong Kong: A1 with a stable outlook from Moody’s and A+ with a stable outlook from Standard & Poor’s.

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