Local builder Hsin Chong Construction (0404) and Richfield Realty plan to provide homes for the elderly in Hong Kong and across Southeast Asia.
Hsin Chong Strategic Investment, a unit of Hsin Chong Construction, yesterday penned a memorandum of cooperation with Richfield Property Investment.
Under the framework of the MOU, Hsin Chong Strategic Investment and Richfield Property Investment will jointly form a new company to enter into property development and aged care markets in Hong Kong and Southeast Asia.
The new company will enter into cooperation arrangements with land owners to jointly develop real estate projects. Hsin Chong Strategic Investment will provide construction and relevant services while Richfield Property Investment will identify suitable projects. Richfield will also take the lead in the negotiations with land owners, operation, and sales and marketing.
Monthly rents for the homes are estimated to be about HK$8,000 to HK$10,000 per person. Au said the jointly controlled company will possibly acquire sites from or co-develop with large developers, such as Henderson Land (0012).
The company also plans to build elderly homes in several cities in Malaysia, including Kuala Lumpur, where Richfield owns a land bank of more than 40 million square feet. Elderly homes and facilities would be built on 30 percent of the total reserve, while the remainder will be for commercial use.
Joseph CHOI Kin Hung, Chief Executive Officer Designate of Hsin Chong Construction Group, commented at the signing ceremony,
“As a leading construction group in Hong Kong, Hsin Chong is blessed with years of experience in construction and engineering projects.
Phase one is slated for completion in 2017, providing more than 1,000 units. Construction cost for each square foot in the two-story building is 200 ringgit (HK$355). Rents are estimated at HK$1,500 to HK$2,000 per month, with utilities included.
Au said the company is also looking into the elderly care business in large mainland cities such as Shenzhen, Shanghai and Beijing. Other than elderly homes, the new company will also engage in property projects in Hong Kong and Southeast Asia.