McDonald’s to sell eight Hong Kong retail spaces valued at HK$1.2 billion: JLL

[HONG KONG] McDonald’s is planning to sell eight prime retail properties in Hong Kong with a total market value of around HK$1.2 billion (S$196 million), JLL, which has been appointed as the sole agent of the sale, said on Monday (Jul 28).

The McDonald’s outlets in the locations will remain operational, JLL executive director of capital markets Eunice Tang said.

In a separate statement, McDonald’s said that it continually reviewed its property portfolio and that the Hong Kong sites were available for sale as part of that assessment.

The fast-food company, which is headquartered in Chicago, said that it remained fully committed to the Hong Kong market.

Hong Kong Economic Times reported earlier on Monday that McDonald’s planned to sell all of its 23 retail spaces – valued at nearly HK$3 billion in total – in batches, but it would continue operating in existing locations as tenants, and the sale would not affect its operations in the city.

McDonald’s has around 256 restaurants in Hong Kong, the report said, many in rented spaces.

McDonald’s could not be immediately reached for comment.

In 2017, Chicago-based McDonald’s sold an 80 per cent stake in its mainland Chinese and Hong Kong operations to a group that included Citic, its investment arm Citic Capital, and Carlyle Group for up to US$2.1 billion. But the assets remain under McDonald’s.

The sale of the eight retail properties is offered through a public tender that ends on Sep 16. JLL said it had already received significant interest from a wide pool of potential investors.

All the properties are secured with long-term McDonald’s leases, and they are available for purchase either individually or as a portfolio, it added.

Overall prime street rents in the first quarter have fallen back to 2003 levels, as Hong Kong’s retailers battle shifting consumer habits that have led to a wave of store closures. REUTERS