HON KWOK LAND (00160) and KWG LIVING (00216) have issued a joint announcement. On March 4, 2026, The Bauhinia Hotels Group Japan I entered into a sale and purchase agreement with the buyer, Trust East Real Estate Investment Company Limited, for the disposal of a property at a consideration of JPY 1.542 billion. The Bauhinia Hotels Group Japan I is solely funded and controlled by a joint venture company, which is 60% owned by Best Range Global. Best Range Global is a direct wholly-owned subsidiary of HON KWOK LAND and an indirect non-wholly-owned subsidiary of KWG LIVING.

The property is located at 1-18-2 Bakurocho, Chuo-ku, Osaka City, Japan. It is a 10-story hotel building with a total gross floor area of approximately 1,017.05 square meters, containing 55 hotel guest rooms. The property is currently leased to an independent hotel operator and is operating as a boutique hotel. The Bauhinia Hotels Group Japan I originally acquired the property on September 6, 2023, for a consideration of approximately JPY 900 million, including local consumption tax. The property is leased to an independent hotel operator and operates under the "R Hotel" brand, which is positioned as a boutique hotel focusing on middle-class customers.

The sale consideration represents a premium of approximately 2.1% over the property's market valuation of JPY 1.51 billion as of December 31, 2025. However, compared to the joint venture company's original acquisition cost in 2023, the consideration represents an increase of approximately 71.4%. The management of the joint venture company also considers the slight premium over the December 31, 2025 market value to be reasonable, as the property comes with an existing lease, which can limit flexibility in negotiations with potential buyers. Furthermore, given the prosperous development of the Japanese real estate market in recent years, the joint venture company is fine-tuning its overall investment strategy in Japan. Therefore, the joint venture company believes it is in its best interest to sell the property to reduce its investment exposure in Japan, thereby freeing up capital for other opportunities.