Hon Kwok Land (00160) plans to sell its subsidiary, a property in Osaka, Japan, for approximately 1.542 billion yen.

HON KWOK LAND (00160) and CHINNEY INV (00216) jointly announced on March 4, 2026, that The Bauhinia Hotels Group Japan I has entered into an agreement to sell the property to the buyer Trust East Real Estate Investment Company Limited for a price of 1.542 billion yen. The Bauhinia Hotels Group Japan I is solely funded and controlled by a joint venture company, in which Best Range Global (a direct wholly-owned subsidiary of Han Guo and an indirect non wholly-owned subsidiary of Jianye) owns a 60% stake. The property is located at 1-18-2 Horomachi, Chuo-ku, Osaka, Japan. It is a 10-story hotel building with a total floor area of approximately 1,017.05 square meters, including 55 hotel rooms. The property is currently leased to an independent hotel operator and is operated as a boutique hotel. The Bauhinia Hotels Group Japan I acquired the property on September 6, 2023, for approximately 900 million yen (including local consumption tax). The property is leased to an independent hotel operator and operated under the chain name "R Hotel", targeting middle-class customers. The price of 1.542 billion yen represents a premium of approximately 2.1% over the market valuation of 1.51 billion yen as of December 31, 2025. However, it represents an increase of approximately 71.4% from the original acquisition price by the joint venture company in 2023. The management of the joint venture company believes that the slight premium relative to the market value as of December 31, 2025, is reasonable due to the constraints on flexibility in negotiations with potential buyers resulting from the existing lease on the property. Furthermore, given the prosperous real estate market in Japan in recent years, the joint venture company is adjusting its overall investment strategy in Japan. Therefore, selling the property to reduce some of the investment burden in Japan and releasing funds for other opportunities aligns with the company's interests.