Multiple negotiations, asset sales.
The Cheng family of Hong Kong is desperately trying to save itself.
On May 27, it was reported that New World Development is considering selling a commercial site in Central, Hong Kong, with an estimated transaction value of around HK$1 billion.
The site covers approximately 4,450 square feet (408 square meters) and can be redeveloped into about 6,100 square meters of commercial property. A consortium has already made an offer to negotiate the purchase.
Just this month, the Cheng family has revealed multiple asset disposal plans, including the 11 SKIES project at Hong Kong International Airport’s SkyCity and three hotel assets in Hong Kong.
Why is one of Hong Kong’s four major families in such a difficult position?
The core issue remains enormous debt pressure. New World’s total borrowing exceeds HK$140 billion, and it is facing a peak in repayment obligations.
“Reducing debt is the top priority, and we will fully implement a seven-pronged debt reduction strategy,” said New World Development CEO. Two of these measures involve selling development projects and disposing of non-core assets.
Listing Assets Rapidly
New World, led by the Cheng family, is a integrated developer with an asset structure roughly split into 30% residential and 70% commercial.
Hong Kong’s commercial real estate market remains under pressure. A managing director at Savills noted that Hong Kong’s commercial office sector is still at a very low point, and recovery in office and retail rents will take time.
The Cheng family is urgently putting some of its heavy asset projects on the market.
Take the 11 SKIES project at SkyCity, a landmark mixed-use development by the Cheng family that has drawn significant attention.
The total floor area is 3.8 million square feet (about 353,000 square meters), with a planned investment of up to HK$20 billion to create a one-stop retail, dining, and entertainment complex.
The Cheng family has already invested over HK$16 billion in the project, including substantial prepayments and contract assets. Additionally, they must pay annual fees to the Airport Authority for the project.
According to UBS estimates, from 2028 to 2066, the company will pay at least HK$1.8 billion annually, totaling approximately HK$54.8 billion. In the short term, holding such a project is somewhat unsuitable for New World, which is burdened with high debt.
In July 2025, it was reported that the Cheng family planned to sell the 11 SKIES project at a loss to improve liquidity and had held preliminary discussions with the Airport Authority.
The valuation at that time ranged between HK$15 billion and HK$17 billion.
In mid-May of this year, New World issued a statement saying that discussions regarding the 11 SKIES project were still ongoing, “to review and explore the possibility of any changes to the contractual arrangements for the project.”
Operational hotel projects are also on the Cheng family’s list of assets to monetize.
In early May, Japan’s Sumitomo Mitsui contacted New World regarding three hotels: Grand Hyatt Hong Kong, Renaissance Harbour View Hotel, and Hyatt Regency Tsim Sha Tsui, expressing interest in acquiring a 50% stake in the asset package, with a total valuation of about HK$15.6 billion.
Although interest exists, a deal is far from finalized.
“Potential buyers have from time to time approached the company regarding various assets (including Hong Kong hotel assets), but no agreement has been reached on any such sale,” New World officially stated.
The Cheng family’s frequent negotiations are driven by the debt burden of its flagship real estate company.
As of the end of 2025, New World’s total borrowing was approximately HK$144.3 billion, with net debt of about HK$122.7 billion.
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