Hongkong Land Q1 profit up 5% as capital recycling hits $4.62b

The group is targeting $5.13b (US$4b) in total capital recycling by 2027.

Hongkong Land Holdings Limited reported a 5% rise in underlying profit for the first quarter ended 31 March, driven mainly by lower net financing costs, according to a company statement.

The property group, however, said the gain was partly offset by weaker contributions from Singapore following the earlier divestment of its stake in Marina Bay Financial Centre Tower 3 ahead of its fund restructuring.

The group generated $769.27m (US$600m) in net proceeds from capital recycling during the quarter, bringing cumulative proceeds to $4.62b (US$3.6b) since it set out its strategic direction in 2024. It is targeting $5.13b (US$4b) in total capital recycling by 2027.

In February, Hongkong Land established the Singapore Central Private Real Estate Fund (SCPREF) with $8.2b in assets under management. The group acts as manager and general partner of the fund.

It said it aims to scale the fund’s assets to $15b over the next five years.

In Hong Kong, profit contribution from its Central portfolio was stable, as higher retail rents and lower operating costs offset softer office income.

Committed office vacancy in Central fell to 5.5% as at end-March, from 6.0% at end-2025, whilst physical vacancy remained unchanged at 7.0%.

In Singapore, contributions declined mainly due to asset disposals, with uncommitted vacancy at 4.1% at end-March.

Hongkong Land said SCPREF continued to deliver steady performance, supported by demand for prime CBD office space and a flight-to-quality trend among occupiers.

In mainland China, contributions rose on the back of new retail projects launched in 2025 and improved rental performance from tenant mix changes.

The group has also begun a portfolio-led restructuring that will introduce four portfolio chief executives overseeing Hong Kong Central, SCPREF, Westbund Central, and its mainland China assets. The changes will be rolled out in phases through 2026.

It has completed $476.95m (US$372m) in share buybacks since April 2025, reducing its issued share base by 2.7%, with about $356.43 (US$278m) remaining through mid-2027.

For 2026, Hongkong Land said its earnings outlook has improved, with full-year underlying profit expected to be slightly higher than the previous year, supported by leasing demand in Hong Kong and cost control measures.