Hong Kong's Festival Walk mall to remain closed after damage during protests: Singapore REIT
SINGAPORE: The Festival Walk shopping mall in Hong Kong that was extensively damaged during protests last week will remain closed until further notice.
"Due to the extensive damage incurred, recovery works including the cleaning up of debris and the assessment of repair works required, are ongoing," said the manager of Singapore-listed Mapletree North Asia Commercial Trust (MNACT) on Tuesday. MNACT owns the shopping mall.
Metal hoardings have been erected at parts of the mall for safety and security precautions. The insurers have been notified and an assessment of claims is underway, the manager said.
"We are assisting and working closely with our tenants as the mall is not operational," it added.
Festival Walk, an upmarket shopping mall in Kowloon Tong, has been closed since 2pm on Nov 12 after groups of protesters smashed glass panels at entrances to the property, including the office lobby and balustrades on various levels of the mall, the manager said.
They also set fire to a Christmas tree in the atrium of the mall.
Units in MNACT - which generates about 62 per cent of its net property income from Hong Kong - has dropped more than 6 per cent since before Festival Walk was damaged on Nov 12.
A note by OCBC analysts suggests that investors could remain cautious.
"From our understanding, MNACT has two types of insurance coverage. Firstly, a policy on physical damage with an adequate sum covered. Secondly, MNACT also has business interruption insurance which covers for the loss of rental income," OCBC Investment Research said in a note last week.
"MNACT has initiated the process for claims and a site inspection has already been carried out by the insurers. However, given that there would likely be a backlog of claims from other affected parties amid city-wide disruptions, we believe it would take time before any reimbursement is done."
It said that sentiment in the stock is likely to remain weak, and volatility in the share price may persist in the near-term.
"Hence, for investors who are open to taking a longer-term view and willing to accept potential near-term volatility, gradual accumulation would be the prudent approach," it said.
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