Hong Kong’s West Kowloon Cultural District Authority has signed a HK$3 billion, 10-year loan facility agreement to address financing challenges until its residential property development generates income. The deal, with Industrial and Commercial Bank of China (Asia), or ICBC, is accompanied by a US$1 billion bond issuance in tranches. Board chairman Bernard Chan said it bridges a funding gap and signals the bank’s confidence in their future profitability.
Hong Kong’s West Kowloon Cultural District Authority announced on Friday that it had signed a HK$3 billion, 10-year loan facility agreement with Industrial and Commercial Bank of China (Asia), or ICBC. The duration is unusually long, as such deals are normally five years in the city.
Board chairman Bernard Chan said the financing would provide a much-needed lifeline in the coming decade before its residential property development could start to generate income. “The loan facility will bridge a funding gap, and the significance is that the bank is confident about our future ability to make money,” Chan said.
The West Kowloon Cultural District includes facilities like the M+ modern art museum and Hong Kong Palace Museum, aimed at boosting Hong Kong’s soft power. ICBC (Asia) chairman and executive director Liu Yagan said the bank, along with the authority, hoped to add more financial momentum to the soft power of Hong Kong and the country as a whole.
This deal, together with a US$1 billion bond issuance in tranches, addresses financing challenges. The authority operates the district, involving partners such as MTR Corporation and Hongkong Electric, with projects like Artist Square Towers yet to yield revenue.
