Mirae Asset invests $300 mn in senior debt on Hong Kong skyscraper

Mirae Asset Daewoo Co. Ltd. has invested $300 million in a senior debt issued to finance the $5.2 billion acquisition of The Center, a landmark skyscraper in Hong Kong, with Singapore’s GIC believed to invest around $3 billion in the secured debt.

A consortium of Chinese and Hong Kong individual investors sold two senior debt tranches to raise $4.1 billion for the purchase of the world’s most expensive property.

Mirae Asset invested in the class A note which reportedly totaled $3.3 billion with a term of one and a half years. It carries a coupon rate of 7.5% in the first year and 12.5% in the following year, the company said on April 26.

Mirae Asset was picked as the sole South Korean investor in the financing package. It plans to resell the senior secured debt to retail investors.

GIC has invested around $3 billion in the debts secured on the 73-story tower, or 10 times Mirae Asset’s investment, according to the Herald Economy, a South Korean daily, on April 27.

In November, Hong Kong’s richest man Li Ka-shing agreed to sell his 75% stake in the office tower in the Central district for $5.2 billion to the consortium which includes Hong Kong’s richest woman of 2017 Pollyanna Chu. It was the world’s most expensive property transaction.

The debt investment comes after Mirae Asset founder Hyeon-joo Park took the helm of Mirae Asset Daewoo Hong Kong last month to boost global investment banking business. Its Hong Kong unit specializes in principal investment.

The Center tower-backed debts drew attention of other South Korean investors because of its low loan-to-value ratio of less than 50%, Mirae Asset added.

Office rents in Hong Kong’s Central district have been rising with inflows of companies from the mainland China and due to limited supply.

By Hyoung-joo Oh

ohj@hankyung.com