This is the weekly news wrap, featuring the latest real estate stories from Hong Kong. Whether your interest lies in industrial, retail, office real estate or asset investments, we have got the news that matters, covered.

Hong Kong Raises Base Rate After Federal Reserve Increase
The Hong Kong Monetary Authority lifted the rate at which banks can borrow from it by a quarter-point to 2 percent after Federal Reserve officials raised their own benchmark lending rate a quarter-point. Rising rates are stoking fears that Hong Kong house prices are vulnerable to a correction. Residential prices have more than doubled over the past decade making it the world’s least affordable market. The International Monetary Fund is among those to have warned about the impact of higher rates.


Next on Hong Kong’s Property Market: Flats With One Fireproof Shelter Per Floor
South China Morning Post
The first private housing estates featuring fireproof shelters on each floor, which will give elderly or disabled people a place to hide if a blaze breaks out, are expected to go on sale in the second half of this year. But having this protective feature will mean higher building management fees, with estimates that the owner of a 500 sq ft flat could pay HK$1,200 (US$153) more each year. 


U.S. Rate Hike Risks Global Fallout
Reuters Breakingviews
U.S. rate hikes risk causing a global fallout. Gulf states, Hong Kong and others that peg their currency to the dollar worry that that following the Federal Reserve’s tightening might endanger growth. But with five more hikes expected by the end of 2019, not doing so risks the ire of financial markets. The Hong Kong dollar has already been falling lower as ample liquidity reduced borrowing costs and widened the gap between its and America’s benchmark three-month interbank lending rate to 1.17 percentage points – the widest since the last recession.


Superman's Gone, and So Are the Thrills
Bloomberg Gadfly
Li Ka-shing, the great trader, played it safe with his last bet. The 89-year-old billionaire announced plans to retire from the Hong Kong empire he founded and hand the reins to his elder son Victor. An architect of the group's shift in focus to utilities from real estate and other more volatile industries, Victor is a good pick to manage a business that will endure through the lives of the patriarch's great-grandchildren and beyond.


China Raises a Key Market Interest Rate, Following Fed's Move
China raised a key short-term interest rate following the U.S. Federal Reserve Bank’s move overnight, in a symbolic reminder that Beijing is keeping an eye on global market trends even as it cracks down on financial risks at home. The People’s Bank of China said it had increased the rate on 7-day reverse repurchase agreements by 5 basis points to 2.55 percent.


Hong Kong’s Property Arms Race Set to Slow As Mainland Developers Abide by Administrative Controls
South China Morning Post
The era of mainland Chinese developers paying well over the odds for Hong Kong property appears set for a pause – providing respite, if only temporarily, from the wild dealmaking that prompted a crackdown by mainland authorities worried about potential fallout from “irrational or speculative investment”, according to Paul Hastings. Under new rules that came into effect on March 1, real estate investments by offshore entities controlled by a mainland Chinese company need to get approval from mainland regulators. The rules apply to both direct and indirectly controlled companies.


Chinese Developers Report Strong Profits But Credit Curbs Could Spell Trouble
South China Morning Post
Mainland property developers have posted strong earnings for 2017, but liquidity remains a concern as Beijing keeps a tight lid on financing to cool the housing market. All four Chinese developers listed in Hong Kong that released their annual results reported strong growth in revenue and profits last year. By revenue, China Merchants Land came out on top with 49 percent growth, while SOHO China reported the biggest increase in profit, up 420 percent from the previous year.


CBRE in the News


Marcos Chan: West Kowloon Will Emerge as the Next CBD
CNFOL (Chinese only)
Features Marcos Chan, Head of Research, CBRE Hong Kong, Southern China and Taiwan


Strong Investment Sentiment in 2018, Grade A Office Market Looks Promising
Hong Kong Economic Times (Chinese only)
Features Stanley Wong, Executive Director, Capital Markets, CBRE Hong Kong