After a prolonged period of quiet, the Hong Kong property market is finally showing signs of a systematic recovery in 2025. According to Centaline Property Agency, the volume of residential property transactions in Hong Kong for the year reached its highest level since 2021. International investment banks, from Goldman Sachs to J.P. Morgan, have become increasingly optimistic about the Hong Kong market, successively raising their forecasts for property price increases in 2026 to over 10%, indicating a substantial shift in market sentiment.
The interim results for the 2026 fiscal year released by New World Development Company Limited (00017.HK) on February 27 further validate this trend. The financial report reveals that NEW WORLD DEV achieved contracted sales of HK$13.8 billion in the first half of the fiscal year, surpassing more than half of the full-year target. Core profit was recorded at HK$3.6 billion, while total debt was reduced by HK$1.7 billion. Contracted sales in the Hong Kong market specifically reached HK$10.3 billion, setting the highest record since 2021.
"The company's debt reduction strategy has proven effective, and business development continues on a positive trajectory," stated Wong Siu-mui, Executive Director and Chief Executive Officer of NEW WORLD DEV, during the results presentation. Through proactive capital management and deepening business operations, NEW WORLD DEV is building a more robust financial and operational foundation and has clearly charted a sustainable growth path.
A dual foundation of operational and financial stability is taking shape. To navigate the uncertain industry environment, NEW WORLD DEV has implemented a series of measures since 2024. These include divesting development projects, launching asset disposal plans, unlocking the value of agricultural land, enhancing the performance of investment properties, optimizing capital and operational expenditures, and actively managing finances to reduce debt and steadily build up its financial buffer.
During the reporting period, the debt reduction strategy showed significant results, leading to continuous improvement in financial resilience. As of the end of 2025, NEW WORLD DEV's total debt decreased by HK$1.7 billion from the beginning of the period to approximately HK$144.3 billion. Concurrently, the company's available funds totaled approximately HK$37.4 billion, comprising about HK$21.5 billion in cash and bank balances and around HK$15.9 billion in available bank credit facilities.
Furthermore, in November 2025, NEW WORLD DEV successfully completed exchange offers for a total of approximately HK$20 billion in perpetual securities and guaranteed notes. On a pro forma basis, the outstanding principal amount of perpetual securities was reduced by about HK$8.7 billion, with a corresponding increase in shareholders' equity of approximately HK$8.7 billion.
The ongoing reduction in debt scale has driven down financing costs. By the end of 2025, NEW WORLD DEV's finance costs decreased by approximately HK$600 million year-on-year to HK$3.1 billion, while the average interest rate dropped by 80 basis points to 3.9%.
Alongside capital management, NEW WORLD DEV has focused on improving operational efficiency and implementing precise cost control measures. In the first half of the 2026 fiscal year, the company's capital expenditure was only HK$3.5 billion, a 29% decrease compared to the previous year. General, administrative, and other operating expenses were HK$1.5 billion, representing an 18% year-on-year saving.
Moving forward, NEW WORLD DEV will continue to strictly control expenditures, with full-year capital expenditure for the 2025/26 fiscal year expected to be less than HK$12 billion, demonstrating a firm commitment to fiscal discipline.
The company's two core business segments performed strongly during the period, forming a dual-engine growth model. In property development, first-half contracted sales reached HK$13.8 billion, exceeding half of the full-year target of HK$27 billion. The investment property segment, excluding the impact of sold assets and newly opened assets, recorded a 5% year-on-year increase in performance, contributing stable recurring income.
This strong operational capability, combined with an improving financial structure, provides NEW WORLD DEV with a thicker cushion to withstand market uncertainties and greater flexibility to capitalize on the current recovery in the Hong Kong property market, creating a solid start for the 2026 fiscal year.
Hong Kong Market Hits Four-Year High The robust performance of NEW WORLD DEV's property sales in the first half of the 2026 fiscal year is firstly attributed to a substantial improvement in the external market environment.
After years of adjustment, the Hong Kong property market reached a turning point in 2025 with both transaction volume and prices rising. Data from the Hong Kong Land Registry shows that for the full year 2025, there were approximately 62,800 residential property sale and purchase agreements, with a total value of about HK$519.8 billion. This represents increases of 18.3% and 14.4% year-on-year, respectively, both hitting highs not seen since 2021. Notably, primary residential transactions exceeded 20,000 cases, reaching a six-year high since 2019.
The recovery in market confidence stems from multiple factors: the start of the US interest rate reduction cycle, the wealth effect generated by the strong performance of the Hong Kong stock market, and the ongoing positive impact of the Hong Kong SAR government's talent attraction policies, all collectively stimulating purchasing power in the property market. Within this recovery cycle, NEW WORLD DEV's sales performance in Hong Kong reached its highest level since 2021.
The key to capturing this rebound lies in NEW WORLD DEV's long-standing belief that "high-quality products will always be scarce."
The super-luxury residential project "Avery" in the Southern District of Hong Kong Island has sold 773 units since its launch in May 2025, representing over 94% of all units, with total contracted sales exceeding HK$13.4 billion. It was also the new development with the highest total sales value in Hong Kong for 2025. The project recently set a new record, with a four-bedroom unit selling for HK$107 million, achieving a price per square foot of over HK$63,000, setting a new price record for stratified units in the area.
Similarly, "Park Violet," also part of the "PAVILIA COLLECTION" and located in the prime Kai Tak Runway area, has sold over 890 units to date, with contracted sales of approximately HK$6.4 billion, making it the best-selling pre-sale project in the Kai Tak Runway area. "The Palace," located in a core area of Hong Kong Island, saw all 388 units completely sold out by mid-December 2025, with total contracted sales exceeding HK$4.2 billion.
Additionally, projects like "Vantage Peak," "Vantage Crest," and "Sky Majesty," a joint development with Henderson Land in Mid-Levels West, have all shown strong market performance, highlighting the demand for products that combine taste and innovative design.
In the mainland China market, NEW WORLD DEV achieved contracted sales of approximately RMB 3.2 billion in the first half of the fiscal year, with core projects demonstrating effective operations. "New World·Victoria Harbour" in Guangzhou's core CBD topped the national chart with a signed online unit price of RMB 218,000 per square meter. The first phase of Guangzhou "Grand Victory Manor" was successfully delivered, enhancing customer reputation, and a second phase will be launched to meet demand. "New World·Sky Lavender" in Guangzhou's Bai'etan business circle launched new units with views of the river and potential fireworks, attracting significant attention from city-wide upgraders and ranking top in its central district hot zone during the Chinese New Year period. Shenyang "Prestige·New World" continued to lead regional sales, serving as a benchmark in the mainland market.
From Hong Kong to mainland China, NEW WORLD DEV's series of strong sales results demonstrate that in an uncertain era, high-quality residential properties have become the brand's most solid asset moat.
Quality Assets Form Foundation for Sustained Growth The market recovery has opened a window of opportunity for NEW WORLD DEV, but the company's true confidence stems from a clearly planned business layout for the coming years.
In property sales, NEW WORLD DEV is entering a period of密集 new project launches in the second half of the 2026 fiscal year.
In Hong Kong, the company plans to launch over 1,300 premium units. This includes the low-density luxury project "Aura" on Rose Street in Kowloon, featuring large three-to-four-bedroom units and expected to be launched by tender in the first quarter of this year. The new project "Vantage Moon" from the "BOHEMIAN COLLECTION" in Tsim Sha Tsui, along with 540 units from Phase 3 of "Pavilia Farm" above Tai Wai Station, are among the projects ready for launch.
In mainland China, Shenzhen will be a focal point in the second half. The "New World 188" project in Longgang, with a total gross floor area of approximately 630,000 square meters, will provide about 3,000 residential units. The first residential phase, "Vantage Delight," is expected to begin sales in the second quarter of 2026. The Shenzhen Nanshan Xili urban renewal project is anticipated to enter the market for sales in the third quarter of 2026, while other ongoing projects will maintain a steady sales pace.
Longer-term growth momentum is rooted in NEW WORLD DEV's deep strategic positioning in the Northern Metropolis. The Hong Kong SAR government's latest Budget reiterated the commitment to accelerating the development of the Northern Metropolis and unlocking the potential of private land. NEW WORLD DEV has taken a leading position in this area, currently holding approximately 15 million square feet of agricultural land reserve, of which 12 million square feet are located within the Northern Metropolis boundary.
Two large-scale projects developed in partnership with central state-owned enterprises commenced construction in 2025. The joint project with China Merchants Shekou on Ma Shak Road in Fanling will provide 2,300 units, while the Phase 4 project in Lung Tin Village, Yuen Long, developed with China Resources Land, will offer over 700 units. Both are expected to be launched for sale as early as the 2027 fiscal year.
Additionally, in November 2025, the Town Planning Board approved a planning application for residential use of additional area in the Sha Ha project in Sai Kung. Wong Siu-mui revealed that the attributable developable gross floor area of over 2 million square feet is expected to complete the land exchange process within the next 1 to 2 years.
In the investment property sector, the K11 brand is steadily expanding from Hong Kong to core cities in mainland China.
In Hong Kong, K11 MUSEA and K11 Art Mall maintained near 100% occupancy rates. Since July 2024, K11 MUSEA has attracted over ten international luxury brands for openings, upgrades, and expansions. A new duplex store for Prada, along with Miu Miu and Alo Yoga, are all planned to open within 2026. The office portfolio also performed strongly, with Man Yee Building in Central and New World Tower achieving occupancy rates of 97% and 90% respectively. The occupancy rate for the twin-tower office development on King Lam Street in Cheung Sha Wan has risen to 74%.
The K11 footprint in mainland China is also expanding rapidly. Since its opening in April 2025, Shenzhen K11 ECOAST recorded over 13 million visitor人次 by year-end. Guangzhou Hanxi K11 opened at the end of September 2025 and welcomed approximately 700,000 visitors during the National Day holiday period. The flagship project K11 ELYSEA on Huaihai Middle Road in Shanghai is progressing steadily, with the office component, K11 Atelier Huaihai, achieving a pre-commitment rate of over 50%. Hangzhou K11 Art Mall and K11 Atelier are planned to open progressively starting from the fourth quarter of 2027.
Standing at the midpoint of the 2026 fiscal year, the most challenging period appears to be over. The Hong Kong property market has rebounded from its lows, while the mainland market is stabilizing and recovering under the policy direction of "high-quality development." Throughout this cycle transition, NEW WORLD DEV has delivered a convincing interim report. It is believed that with its rich reserve of quality projects,卓越 product delivery capability, and increasingly mature commercial operations, the company will take solid steps forward on the new journey of high-quality development.