If land supply returns to a reasonable level Chen Qizong: Property prices can slow down

Hang Lung Properties (00101), writes a letter to shareholders twice a year to explain management’s views on the macro economy and the company’s prospects. He believes that once land supply returns to a reasonable level, land prices should ease, and property prices in Hong Kong will slow down one day.

In his annual report on the theme of “profound and professional”, Chen Qizong stated that land shortage is the root cause of many social ills in Hong Kong. A balance must be struck between available land supply and conservation in country parks. Reclamation is another method. However, it is opposed to reclamation in Victoria Harbour. On the contrary, the eastern and western borders of parts of Kowloon and the New Territories can be further developed without destroying the natural landscape.

Recovery of luxury sales, good performance

In terms of retail sales, he said that personal consumption is rapidly becoming the backbone of China’s economy, driving China-Hong Kong retail sales to continue to recover, and the recovery of luxury goods sales in the Mainland is particularly strong, reflecting that the six-year winter has become a thing of the past and I believe it will have a positive impact on the Group’s performance.

Hang Lung Chief Executive Officer Chen Nanlu will retire in July and become chairman of the board of directors. Chen Qizong pointed out that the more urgent challenge facing the company is the succession of management. The board of directors is closely monitoring the situation and intends to formulate succession plans for several positions in the top management team.

For the macro-environment, Chen Qizong warned that due to the oversupply of funds, the global economy is facing a potential crisis and is worried that the next crisis will be more severe than in 2007 and it may take decades to recover.