Jack Ma Buys Half an Office Tower; Low‑Profile Family Nets ¥5.4 billion (≈$758 million)

Jack Ma Buys Half an Office Tower: a headline deal that signals a strategic shift for Hong Kong office real estate and Jardine/Keswick capital allocation.

Deal summary — who bought what and for how much

On October 17, Alibaba Group (Ālǐbābā 阿里巴巴) and Ant Group (Máyǐ Jítuán 蚂蚁集团) announced they had acquired the top 13 floors of the Hong Kong office complex 港岛壹号中心 (Gangdao Yīhào Zhōngxīn 港岛壹号中心) in Causeway Bay.

The purchase price was US$925,000,000 (¥6.60 billion RMB).

What was bought — the physical asset and implied pricing

The package includes the top 13 floors — effectively half the tower — together with rooftop signage rights and about 50 parking spaces.

The acquired gross floor area is approximately 301,600 sq ft (about 28,000 m²).

Alibaba’s headline price implies an average of roughly ¥235,500 RMB/m² (≈US$33,000/m²).

Why the sale matters — a steep discount and who sold

The seller was Mandarin Oriental Hotel Group (Wénhuá Dōngfāng Jiǔdiàn Jítuán 文华东方酒店集团), part of the Jardine‑controlled business interests historically tied to the Keswick family (Kaiseike 凯瑟克家族).

The property originally stood on the site of the former Hong Kong Yee Tung (怡东) hotel and was redeveloped into a 24‑storey Grade‑A office tower after the hotel closed in 2019.

The redevelopment reportedly involved an investment of about HK$5.0 billion (≈¥4.57 billion RMB; ≈US$641 million).

The building was once marketed with much higher expectations.

In 2017 a sale process valued the project at as much as ¥27.0 billion RMB (≈US$3.78 billion), but the current transaction prices the whole project at roughly ¥14.0 billion RMB (≈US$1.96 billion), a near‑50% markdown from that earlier peak valuation.

After transaction costs, the Keswick family’s Mandarin Oriental unit is estimated to realize about US$758,000,000 (¥5.41 billion RMB) from the disposal.

Market context — selling in a down cycle

Hong Kong’s central office market has softened since the prior peak.

Local brokers note many Grade‑A office assets trade 30%–40% below peak prices and vacancy has risen.

In that environment, the Keswick family opted to monetize a non‑core asset at a still‑substantial cash gain, rather than wait for a market recovery.

The broader transaction chain: sale + privatization

Mandarin Oriental issued two major announcements on October 17.

First, it confirmed the sale of the 港岛壹号中心 asset, with the deal expected to close by December 2025.

Second, Mandarin Oriental’s parent — controlled by the Keswick/Jardine interests — disclosed a proposed privatization.

The parent intends to buy out the roughly 11.96% of Mandarin Oriental it does not already own, for a cash consideration of US$4.20 billion (¥29.97 billion RMB).

Proceeds from the property sale are slated in part to support the privatization offer, which includes a special dividend component.

The combination — divesting noncore real estate and taking the luxury hotel group private — reflects a strategic refocus and a desire to simplify ownership to back a long‑term expansion plan in luxury hospitality.

Why the family is selling now — Jardine Matheson’s strategy

Jardine Matheson (Yihe 怡和), the group tied to the Keswick family, has a 193‑year history and a diversified portfolio spanning hotels, real estate, retail, automotive and financial services.

Recent operating pressures in Hong Kong retail rents and several consecutive annual setbacks pushed the group to accelerate strategic adjustments.

Key factors they cited and which emerge from recent activity include:

• Hong Kong retail rents fell and local retail income declined; mainland China retail rents rose and mainland returns became relatively more attractive.

• Jardine‑linked businesses have reoriented capital toward mainland expansion, opening multiple projects there in 2024–2025 (for example, new shopping complexes in Nanjing and Chongqing and hotels opening through the Yangtze Delta in 2026).

• The group announced a shift away from residential development toward premium commercial properties — a move aimed at stabilizing returns after recent underperformance.

Other financial notes from the group’s recent history — quick facts

• Jardine / Keswick family net worth (Forbes Hong Kong list) was reported at about US$2.45 billion (≈¥17.48 billion RMB).

• The Mandarin Oriental redevelopment was reported to have cost roughly HK$5.0 billion (≈¥4.57 billion RMB; ≈US$641 million).

• Earlier valuations and bids: a 2017 asking/market valuation noted as roughly ¥27.0 billion RMB (≈US$3.78 billion) versus today’s implied project value of about ¥14.0 billion RMB (≈US$1.96 billion).

• Mandarin Oriental’s parent’s proposed privatization consideration is about US$4.20 billion (¥29.97 billion RMB).

• Past investment in mainland retailer Yonghui (Yonghui Superstores 永辉超市): Jardine‑linked investors reportedly paid about ¥5.7 billion RMB (≈US$799 million) in 2014 and sold in 2024 for about ¥4.496 billion RMB (≈US$630 million), a decade loss of roughly ¥1.2 billion RMB (≈US$168 million) excluding dividends.

Market impact and outlook — what this means for investors and occupiers

Analysts say a high‑profile tenant group such as Alibaba Group and Ant Group moving a headquarters function into a Causeway Bay landmark should help attract related corporate tenants and service providers.

For the Keswicks and Jardine Matheson, the transaction accelerates a reallocation of capital to businesses and geographies the group deems higher‑return.

The deal also uses proceeds to facilitate a privatization that they believe will better support Mandarin Oriental’s long‑term luxury growth strategy.

From an investor perspective, key takeaways are clear and actionable:

• Timing matters: Monetizing a trophy asset in a down cycle can still produce substantial cash to fund strategic moves like privatization and mainland expansion.

• Occupier demand: Big-name occupiers can re‑energize secondary leasing markets in premium submarkets like Causeway Bay.

• Valuation memory: Peak-era valuation expectations (2017) remain a reference point, but current market pricing reflects 30%–50% adjustments in sentiment and liquidity for Hong Kong office real estate.

Quick bullets — the headline facts at a glance

• Buyer: Alibaba Group (Ālǐbābā 阿里巴巴) & Ant Group (Máyǐ Jítuán 蚂蚁集团).

• Asset: Top 13 floors of 港岛壹号中心 (Gangdao Yīhào Zhōngxīn 港岛壹号中心) — ~301,600 sq ft (~28,000 m²).

• Price: US$925,000,000 (¥6.60 billion RMB).

• Seller proceeds (estimated): US$758,000,000 (¥5.41 billion RMB) to the Keswick family’s Mandarin Oriental unit.

• Context: Market trading 30%–40% below peak; project value down from ~¥27.0 billion RMB in 2017 to ~¥14.0 billion RMB today.

Linking opportunities — where to point readers next

Internal and external anchor suggestions that add SEO value:

• Anchor: “Hong Kong Grade‑A office market trends” — link to internal market report or a trusted market research page.

• Anchor: “Mandarin Oriental privatization details” — link to the company announcement or investor presentation.

• Anchor: “Alibaba real estate strategy” — link to analysis of Alibaba’s corporate real estate moves or HQ expansions.

• Anchor: “Jardine Matheson portfolio shifts” — link to a profile of Jardine Matheson (Yihe 怡和) and its recent transactions.

Actionable next steps for readers

If you’re an investor, founder, or occupier tracking Hong Kong real estate, consider these moves:

• Review your exposure to Hong Kong Grade‑A office assets and model downside scenarios consistent with 30%–50% peak-to-current spreads.

• Monitor leasing demand in Causeway Bay and nearby submarkets for signs of uplift from major corporate occupiers.

• Track privatization outcomes and any special dividend flows from the Mandarin Oriental transaction for potential capital recycling opportunities.

Conclusion — strategic signal from an iconic transaction

This deal blends corporate real estate strategy, liquidity management, and a privatization playbook into one high‑profile move.

For Hong Kong real estate watchers and mainland expansion strategists, it’s a timely reminder that timing, occupier signaling, and capital redeployment matter more than ever.

Jack Ma Buys Half an Office Tower remains a short, sharp signal of how big tech can reshape prime real estate portfolios and city dynamics.

References

• Jack Ma Buys Half an Office Tower; Low‑Profile Family Nets ¥5.4 billion – Eastmoney
• 21st Century Business Review (site) – 21世纪商业评论
• Mandarin Oriental Hotel Group (corporate site) – Mandarin Oriental