New World Development to hand over 11 SKIES project to Airport Authority

New World Development has reached an agreement with the Airport Authority Hong Kong to prematurely terminate its lease for the 11 SKIES project. Under the terms, New World will hand over three office buildings and an entertainment hub to the Airport Authority without charge. To facilitate this early termination, New World will pay the Airport Authority between HK$2.3 billion and HK$3 billion in cash and cash equivalents.

The Airport Authority plans to take full control of the project to redevelop it under a new operational model aligned with the SKYTOPIA strategic vision. This redevelopment aims to transform the site into a major landmark featuring innovative entertainment, diverse dining, a world-class performance venue for 20,000 people, and a large-scale yacht harbor. The handover is expected to be completed by April 2027, with operations slated to begin in 2028.

As part of the deal, Chow Tai Fook Enterprises, the largest shareholder of New World Development, has granted the Airport Authority an option to acquire 750 million shares of New World Development for HK$2.25 billion within three years. This arrangement is viewed by analysts as a way to mitigate New World's long-term financial liabilities, which were estimated to be as high as HK$70 billion, allowing the company to focus on deleveraging and future growth.