Business Overview | Harbour City

Harbour City, the Group's flagship property situated in the commercial hub of Tsim Sha Tsui, generates over 60% of the Group's gross rental income from its 8.4 million square feet of prime commercial space comprising offices, retail shops, serviced apartments, hotels and club, and approximately 2,000 car parking spaces. With its 700 shops including 50 restaurants and two cinemas, Harbour City is home to Hong Kong's largest shopping, dining and entertainment centre.

Retail

Harbour City is one of the world's leading shopping destinations. It is understood to be the largest shopping mall in the world, not in terms of size but total tenants' sales. It is also the largest retail complex in Hong Kong with its two million square feet of retail space that represents 75% of the retail area of Canton Road. It offers the critical mass in the heart of the most dynamic retail location of Hong Kong for a captivating "shoppertainment" experience that enchants new and regular shoppers.

Harbour City offers a comprehensive mix of stores across a finely-calibrated price point matrix of luxury, middle market and high street brands. Retail clusters such as KidX (the best of class selection for kids), Cosmetics (over 200 brands), SportX, Audio-visual Centre and Shoes (more than 100 brands) provide distinct and unique shopping experience for its patrons.

Rejuvenation continues to bring surprises to the market, enhance the shopping experience and maximize retail value. Harbour City's 530-metre retail shop street frontage along Canton Road is one of the most coveted premium locations for international luxury brands given its draw with the visiting mainland customers. It has become a showcase for retailing in the Mainland. The all-star cast of top notch brands is forever juggling for advantageous position and shop front design. Following the opening of Fendi's and Giorgio Armani's multi-level flagship stores in 2012, Paul & Shark opened its flagship in April 2013. Chanel will expand its presence by 10,000 square feet in 2014 to transform its Canton Road location into a true "maison" concept. Versace is poised to open a three-level full concept store. Uniqlo will open its largest store in Kowloon, at Harbour City, with an 18,000 square foot space in 2014.

The shopping complex is a popular spot for festive celebrations. In addition to the annual iconic Canton Road street party on Christmas Eve and festive mall decorations, Harbour City has rolled out a series of fun and engaging events to attract shoppers and sales. The acclaimed Doraemon exhibition in 2012 was a big success. The Rubber Duck float from May to June 2013 was a giant hit. Harbour City collaborated with the conceptual Dutch artist Florentijin Hofman to create and exhibit the inflatable 16.5-metre giant Rubber Duck at Ocean Terminal ("OT"), marking the Duck's debut in Greater China and Hong Kong's first maritime exhibition. The giant Rubber Duck float on Hong Kong's Victoria Harbour, together with installations of Rubber Duck displays in forecourt, attracted phenomenal foot traffic from locals and tourists alike and created an international media frenzy.

Harbour City is among the first malls in Hong Kong to incorporate art elements into mall events, making art appreciation part of people's daily lives. In addition to a number of art events held at the mall throughout the year, Harbour City has also devoted a 1,000-square-foot prime retail space on Level Two of Ocean Centre for the establishment of the unique "Gallery by the Harbour". Boasting a 20-foot high ceiling and full-height glass wall, this admission-free art gallery offers visitors a unique experience of appreciating art pieces from around the world against the backdrop of the stunning Victoria Harbour.

The new lease for OT with the Government has finished in 2012. The Group has been striving to enhance Harbour City's unrivalled critical mass and as a must-visit shopping landmark in Hong Kong. The rejuvenation and conversion works, including the renovation and extension of OT, are also set to add further growth impetus.

Renovation of OT is an important part of Harbour City's substantial premises improvement initiatives for further value creation. It will strategically relocate the atrium towards the centre of the mall to substantially extend OT's very valuable front portion to the rear of the mall. These initiatives are highly value accretive. A host of prestige watch brands including Rolex, Tag Heuer and Tudor will take up the new shops. Best-of-class retailers are scouted for the transformation.

An extension building at OT, designed by internationally renowned architect firm Foster, is pending building approval. It will also further enhance the value at the rear of OT with attractive culinary offerings in the middle of the harbour and with a fabulous panoramic view of the Hong Kong Island sky line and the Peak.

Retail Tenant Mix (by Rental and Area)

  % by Rental % by Area
Fashion 31.0 29.1
Leather Goods - Shoes Bags & Related Trades 24.1 11.0
Department Stores, Confectionery Products 16.4 22.1
Jewellery, Beauty and Accessories 16.2 7.7
Restaurant, Fast Food, F&B 3.4 13.8
Children's Wear & Related Trades, Toys 2.7 6.4
Electrical & Audio-visual Equipments 2.5 2.1
Sports Wear 2.0 2.6
Others 1.7 5.2
  100.0 100.0

Office

Boasting 4.3 million square feet in total, Harbour City offers the largest Grade A office portfolio in Kowloon with 10 commercial buildings including Gateway Tower 1, 2 and 6, Prudential Tower, Sun Life Tower, Ocean Centre, World Finance Centre (South and North), Wharf T&T Centre and World Commerce Centre. The convenient location, reputable property management services and ancillary features including the mega mall, Marco Polo hotels, fitness centre and private recreational club, Harbour City has an unrivalled competitive edge compared to 'pure offices'.

Serviced Apartments

Situated on top of the Harbour City Gateway Towers, Gateway Apartments offers 499 tastefully furnished apartments from studio units to deluxe three-bedroom and penthouse suites. It is undoubtedly an ideal home for the discerning residents who look for the highest level of elegance and convenience. The substantial renovation underway will completely refresh the apartments on offer, effectively catering to customers' sophisticated demands. Its outstanding service standards were recognised with "The Best Serviced Apartment Award in Hong Kong 2011" presented by Squarefoot.com.hk Magazine.


Portfolio Information
(Extracted from The Wharf (Holdings) Limited Annual Report 2012)

  Gross Floor
Area
(sq ft)

Revenue
(HK$ Million)
Average
Occupancy
(%)
Year-end
Valuation
(HK$ Million)
Retail 2,049,000 4,223 98 69,644
Office 4,263,000 1,710 96 47,336
Serviced Apartments 670,000 310 84 8,390
Hotel and Club 1,368,000 1,265 85 7,960



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