The US headquarters of McDonald's is arranging the sale of its 23 Hong Kong properties in batches, with a total market value of around HK$3 billion. The first phase involves the sale of eight properties currently leased to McDonald's Hong Kong, including prime locations such as Tsim Sha Tsui's Star House, with an estimated market value of HK$1.2 billion.
In response to inquiries, McDonald's Corporation, headquartered in Chicago, stated that while it is selling several properties in Hong Kong, the operations of the restaurants in these locations will not be affected. This year marks the 50th anniversary of McDonald's in Hong Kong, and the US parent company will collaborate with McDonald's Hong Kong to celebrate through a series of activities, reaffirming its commitment to the Hong Kong market.
Last week, Jones Lang LaSalle (JLL) was finally appointed to handle the sales. The first phase includes eight McDonald's restaurant properties located in high-traffic areas such as Tsim Sha Tsui, Causeway Bay, Mong Kok, Kennedy Town, Tai Kok Tsui, Yuen Long, Tsuen Wan, and Tsz Wan Shan. The floor areas of these shops range from 6,800 to 19,000 square feet, with a combined market value of approximately HK$1.2 billion. The tender will close in September, and depending on the response, the remaining properties will be released next year.
Parent company emphasizes optimizing real estate portfolio
It is understood that McDonald's Corporation has traditionally purchased retail properties in Hong Kong for self-use and long-term investment. In its response yesterday, McDonald's stated that the group regularly reviews its property holdings and continuously optimizes its real estate portfolio. The parent company will sell several properties in Hong Kong, but restaurant operations at these locations will remain unaffected. McDonald's Corporation remains committed to the Hong Kong market. As McDonald's Hong Kong celebrates its 50th anniversary this year, the parent company will join hands with McDonald's Hong Kong in a series of celebratory activities, looking forward to continued growth, innovation, and leadership in this important market.
According to McDonald's Hong Kong's official website, the chain entered Hong Kong in 1975 and now operates around 256 restaurants with 15,000 employees. In 2017, McDonald's Corporation sold its mainland China and Hong Kong businesses, along with a 20-year franchise agreement, to a consortium comprising CITIC, CITIC Capital, and The Carlyle Group, retaining only partial equity and property ownership. Subsequent minor changes in shareholding have occurred, but CITIC still holds a 52% controlling stake.
Attractive yields of 2-3% draw buyer interest
Eunice Tang, executive director of capital markets at JLL in Hong Kong, emphasized that the seller is McDonald's Corporation, headquartered in the US, and that McDonald's Hong Kong will continue operating in these properties with no planned changes. Given the prime locations, strong tenant profile, and attractive returns, many potential buyers have already expressed interest.
Additionally, sources indicate that McDonald's Corporation plans to sell another eight properties in the second phase next year, including shops in North Point and Quarry Bay, with an estimated market value of HK$1.11 billion.
Tang stated, "The properties currently for sale come with long-term leases, offering highly attractive returns—higher than typical market offerings. Generally, premium properties yield around 2-3%, but ours are definitely above that range."
JLL highlighted that the eight properties feature prominent signage, offering advertising benefits, spacious layouts, high visibility, and stable foot traffic. These assets, held by the current owner for decades, present a rare investment opportunity to acquire high-yielding, quality retail properties. Buyers may bid for the entire portfolio or individual properties, with the tender closing at noon on September 16, 2025.
Star House shop, largest at nearly HK$400 million
Tang added that this tender represents a rare market opportunity, with properties leased long-term to the financially strong McDonald's tenant, ensuring stable cash flow and offering investors an exceptional acquisition chance not seen in decades. Many McDonald's outlets have been landmark dining destinations in their districts for over 30 years, with some operating 24 hours, underscoring the tenant's business strength and resilience. The largest property is the ground-floor and basement shop in Tsim Sha Tsui's Star House, valued at nearly HK$400 million.
Historical records show that McDonald's Corporation has occasionally sold Hong Kong properties in recent years. For instance, the Star House shop was offered for tender in 2019 with an estimated market value of HK$1 billion, and rumors suggested the 'Shop King' Tang Shing-bor family had negotiated a HK$900 million purchase, though the deal was never finalized.
The current valuation of around HK$400 million reflects a significant drop. Other past transactions include the sale of a 20,277 sq ft shop in Quarry Bay for HK$260 million in 2021 and a shop in Sham Shui Po for HK$22.683 million.
(Source: Wen Wei Po; Journalist: Ivy Chong; English Editor: Darius)
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