Wynn Properties' total investment property market value falls to approximately HK$330 million in 2025

Guan Dian Net News: On March 16, Yongli Property Development released its full-year results for the fiscal year ending December 31, 2025.

It is reported that, due to the ongoing downturn in Hong Kong’s commercial and residential property markets, the group recorded a total comprehensive expenditure attributable to shareholders of approximately HKD 300.8 million for the year ending December 31, 2025, an increase from HKD 274.3 million in the same period last year. The loss was mainly due to a fair value decrease of approximately HKD 273.2 million in investment properties and a reduction of about HKD 33.2 million in the fair value reserve of the Kwun Tong redevelopment project fund (Epic Capital Fund). Excluding these non-cash valuation changes and share purchase expenses, the group’s net profit was approximately HKD 5.7 million, a significant decline from HKD 13 million last year, mainly due to decreased rental income and increased operating expenses.

Additionally, the total market value of the group’s investment properties fell to about HKD 330.9 million, a decrease of approximately HKD 273.2 million for the year. Management pointed out that the high-interest environment led to property owners selling, negative interest rate spreads dampening buyer sentiment, and tighter bank credit, causing a spiral decline in retail property prices; annual rental income was about HKD 21.2 million, down 21.0% year-on-year. Despite maintaining a high occupancy rate of 96.2%, the group offered more rent concessions to retain tenants.

It is noteworthy that Yongli Property holds a 10% stake in the Kwun Tong Hung To Road No. 32 redevelopment project, which has been completed and sales have begun. However, due to oversupply of office space in Kwun Tong and reduced demand from mainland Chinese companies, the fund’s fair value dropped from HKD 55.7 million last year to HKD 27.4 million. Since the initial investment, the project’s fair value has decreased by approximately HKD 77.1 million.

The annual report shows that Yongli Property made significant debt restructuring in 2025. To save on high financing costs, the original bank loans with interest rates ranging from 5.33% to 6.34% were fully repaid using cash and new loans, totaling about HKD 132.2 million. As of the end of the year, the book value of bank loans was zero; the group obtained about HKD 60 million in new unsecured loans from an affiliated company, with better terms than bank loans but required repayment within one year.

Due to this debt restructuring, the group’s liquidity situation deteriorated significantly. Net current liabilities surged from HKD 7.6 million last year to HKD 57.1 million, and the current ratio plummeted from 0.91 to 0.16. Cash and bank deposits sharply declined from HKD 79.4 million to HKD 8.3 million.

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