Murray Building, yours for only $4.4b

Projects, Slider 07 Nov 2013
Murray Building, yours for only $4.4b

Historic former government office goes to Wheelock subsidiary

The prominent landmark government office building, Murray Building in Central, can look forward literally to a new lease of life as a hotel after the site was sold to the listed subsidiary of investment holding company Wheelock and Company (0020) for HK$4.4 billion.

Lands Department announced Wednesday that it had awarded the tender for a 50-year lease for the site at Cotton Tree Drive, near the Peak Tram tourist hotspot, to Smart Event Investments, a wholly-owned subsidiary of Harbour Centre Development (0051), itself a subsidiary of Wheelock.

In doing so, Harbour Centre Development beat off 16 other tenderers including some big names such as Sun Hung Kai Properties (0016), Sino Land (0083), Cheung Kong (Holdings) (0001) and Macau casino concessionaire Galaxy Entertainment (0027).

Its offer to the government also managed to beat market estimates of between HK$2.2 billion and HK$3.3 billion by a comfortable margin.

The new owner however has to keep the building, completed in 1969 with 27 levels including the basement, intact.

“The existing building is not to be demolished and its maximum gross floor area that may be attainted is 30,200 square metres,” Lands Department said.

Harbour Centre Development did not immediately respond to enquiries from Construction Post regarding total cost and period required for renovation into hotel use.

“The site is a unique property and possibly the last remaining prime site available in Central Hong Kong, for a major hotel,” Harbour Centre Development and Wheelock said in a joint stock exchange statement.

Murray Building which was the tallest government building at the time of its completion in 1969 is to be converted into hotel use  (Danny Chung)

Murray Building which was the tallest government building at the time of its completion in 1969 is to be converted into hotel use (Danny Chung)

Only a stone’s throw away are major government buildings such as Government House and the Central Government Offices, and the Central business district with major commercial buildings such as the Citibank and ICBC towers and the US Consulate building.

Harbour Centre Development has until the end of 2018 to complete its obligations under the government lease for the site.

The company appears to have no trouble meeting the huge initial capital outlay with net cash and available-for-sale investments totalling HK$5.69 billion as of 30 June this year.

The government announced last May that it would dispose of the site for hotel use through a public tender starting in June and lasting about five months.

Danny Chung

 

 

 

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