Annual Report 2019

ANNUAL REPORT 2019 13 CHAIRMAN AND CHIEF EXECUTIVE OFFICER’S STATEMENT Property development continued to be a core business of the Group. We have built a strong property development portfolio to maintain future growth. During the last financial year, we continued to score historic new highs in our cumulative pre-sales value. Such figure points to a clear visibility for the Group’s property sales in the years to come. The land resources we now have is sufficient for the Group’s development in the next decade. The reason why we are diversified regionally with a clear focus of targeting the middle class segment is simply that the real estate industry has cycles. Regional diversification enables us to acquire land at a lower cost from different markets at appropriate timing. We will continue to invest in regions with strong population growth and strong demand for housing. This includes key cities in the UK and Australia as well as selected cities in Asia. In Manchester, in particular, housing for middle class has great potentials. At the moment, weaker pound and Australian dollar against the Hong Kong dollar has provided us with a good opportunity to allocate capital in these regions. Despite fierce competition in land acquisition, Greater Bay Area is also another region we will explore given its growth potentials. For land acquisition in Hong Kong, as mentioned in our last year’s annual report, we remain cautious as we see prices have risen beyond affordability of the general public and profit margin has become thinner. In respect of hotel operations, I am delighted to report that our hotel RevPAR in Hong Kong continued to improve, owing to an increase in tourist arrivals from Asian countries and long-haul tourism as well as a rebound of Mainland tourists. For other overseas hotel markets, our hotel operations also continued to benefit from more frequent travel and greater demand from the Asia’s middle class. Going forward I expect new room additions in Australia and the UK will drive the growth of our hotel operations.