CBRE has been appointed as the sole agent for the public tender sale of Popway Hotel, at No. 117 Chatham Road South, Tsim Sha Tsui. The tender closing is set for 12nn, 1 August 2024 (Thursday).

The Popway Hotel enjoys an exceptional location , adjacent to Tsim Sha Tsui's core business district with large shopping malls. The property is also at the intersection of four railway stations, connecting various districts of Hong Kong. The West Kowloon high-speed rail terminus is just a 10-minute drive away, providing seamless connectivity to the Guangdong, Macau and Greater Bay Area.

Popway Hotel is an 20-storey building with a total gross floor area of approximately 24,551 square feet. The property was converted into a boutique hotel in 2015, providing 63 rooms and comprehensive facilities including a small fitness centre, and a multi-purpose meeting room. Currently, a trending restaurant, fonded by KOLs and celebrities, is on 19/F, and the rooftop offers panoramic views of Victoria Harbour.  The Hotel faces the lush greenery of the Centenary Garden and the bustling urban landscape of East Tsim Sha Tsui.

Reeves Yan, Head of Capital Markets, Executive Director of CBRE Hong Kong, stated: "The key highlight of Popway Hotel is its eligibility for conversion into a student housing. The property is right next to the Hong Kong Polytechnic University, and within a 10-15 minute reach of other major universities, including Hong Kong Metropolitan University, City University of Hong Kong, and Hong Kong Baptist University.

"What’s more, the government in the 2023 Policy Address announced an increase in the quota for non-local students at the eight universities, from 20% to 40%. Since student accommodation supply has been insufficient and the number of non-local students has risen significantly (by at least 30% over the past four years), rental rates are expected to continue to rise, making student dormitory investment an attractive option in the property investment market."

Yan continued: “The government has introduced various Talent Entry Schemes in recent years, such as the Talent List and the Technology Talent Admission Scheme (TechTAS), to attract quality people to invest and support the development of Hong Kong. These schemes simplify the immigration arrangement, allowing the number of mainland students and visiting scholars to increase. As a first-tier international city, Hong Kong has good education resources and development opportunities.

"Mainland students who come to Hong Kong to study in Hong Kong can gain education resources and international exposure. In addition, thanks to the high-speed rail and various port transportation networks and facilities, transportation between Guangdong and Hong Kong is more convenient, and many parents are interested in sending their children to Hong Kong as soon as possible to further their studies. This project is the closest hotel available for sale to the Polytechnic University. The project can potentially provide 130-150 beds, making it an ideal choice for student dormitory renovation project.”

Zac Wong, Director of Capital Markets of CBRE Hong Kong, added: "To meet the strong demand for student accommodation, some universities and investors have acquired hotels and converted them into student housing. For example, AEW and Crystal International Group acquired Hotel SAV in Hung Hom and converted it into the "Y83" as an all-suite student accommodation project in 2021. The project achieved an occupancy rate of over 90% in the past two years.

"In late 2022, Wang On Properties teamed with global private equity fund, TPG Angelo Gordon to purchase the Pentahotel Hong Kong for HK$2 billion and invested more than HK$100 million to covert it into the "Sunny House" student co-living, which currently has a very favorable pre-leasing rate. In addition, the Hong Kong Metropolitan University acquired the "MU88" Hotel in Hung Hom from investor, Mr. Law Sau Wang, Alexander earlier this month for nearly HK$1 billion (at a record high price of HK$15,000 per square feet) to address the school's long-standing student accommodation shortage. Hence, as driven by market condition and policy, the demand for student housing properties will continue to rise. We expect the project for sale will attract investors’ attention.”

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