AEON STORES (00984.HK): New lease of Whampoa premises constitutes very substantial acquisition, right-of-use assets up to approximately HKD 304 million
NewTimeSpace News: On 7 September 2026, AEON Stores (Hong Kong) Co., Limited (stock code: 00984) announced that the Company (as tenant) has entered into a conditional new lease on the same date for the ground floor and part of the basement first floor of the commercial podium of Whampoa Garden Phases 5 and 6 (with a lettable area of approximately 184,169 square feet), for a term of nine years from 1 May 2026 to 30 April 2035. The new lease is subject to execution by the landlord, and upon satisfaction of the conditions precedent, it will supersede all statements, arrangements, understandings and agreements previously made between the Company and the landlord in respect of the leasing of the property.
The new lease constitutes a lease modification of the original lease entered into between the Company and the landlord on 18 October 2017, with a term of 160 months (from 1 January 2016 to 30 April 2029). Under the new lease, the monthly rent for years 1 to 3 is HKD 7.5 million; for years 4 to 6, rent will be the open market rent assessed and determined (with a floor of HKD 8.3 million and a ceiling of HKD 9.2 million per calendar month); for years 7 to 9, the rent shall not be lower than the higher of HKD 8.8 million per calendar month or the monthly rent in year 6, and shall not exceed 110% of such higher amount; turnover rent is payable at progressive rates of 6.5% to 7.5% on the portion of annual gross sales exceeding HKD 730 million.
Under HKFRS 16, entering into the new lease constitutes a lease modification which, if effective, would result in the recognition of right-of-use assets of approximately HKD 256 million (calculated based on the minimum monthly rent for years 4 to 9) and approximately HKD 304 million (calculated based on the maximum monthly rent). As the highest applicable percentage ratio under the Listing Rules in respect of the right-of-use assets to be recognised by the Group exceeds 100%, entering into the new lease constitutes a very substantial acquisition of the Company, subject to the reporting, announcement, circular and shareholders' approval requirements under Chapter 14 of the Listing Rules. The Company will convene an extraordinary general meeting to seek shareholders' approval, and a circular containing details of the new lease and the notice of the EGM will be despatched to shareholders as soon as practicable (and in any event not later than 28 September 2026).
The landlord is Glenfuir Investments Limited, an indirect wholly-owned subsidiary of CK Asset Holdings Limited (stock code: 1113), and, to the best of the directors' knowledge, the landlord and its ultimate beneficial owners are independent third parties. The Company has operated its retail business at the property since 1998, considers that the rent under the new lease, negotiated at arm's length, falls within the range of prevailing market rents and is fair, reasonable and on normal commercial terms, and the rent payable will be funded entirely from the Group's internal resources. If the conditions precedent are not satisfied on or before 30 October 2026, the new lease will automatically lapse and the original lease will continue in full force and effect on its original terms.
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