It is reported that Alibaba plans to acquire the One Island East office building in Causeway Bay, Hong Kong for HKD 7 billion

Zhitong
2025.09.30 01:45
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Alibaba is negotiating to acquire the "One Island East" office building in Causeway Bay for approximately HKD 7 billion. The building has an area of about 270,000 square feet and is currently owned by the Mandarin Oriental Hotel Group. Alibaba needs a new headquarters due to business expansion and is expected to gain naming rights and advertising space after the purchase. This transaction will become the largest office building sale this year, breaking the record set by the HKEX's acquisition of the Exchange Square for HKD 6.3 billion

According to media reports, Alibaba (09988) is in negotiations to acquire the "Island One Center" in Causeway Bay, a Grade A office building that may reach up to 13 floors, with each floor covering approximately 20,000 square feet, totaling about 270,000 square feet of floor space, at a price of around HKD 7 billion, with a price per square foot of nearly HKD 26,000. The building is currently owned by the Mandarin Oriental Hotel Group.

According to publicly available information, Alibaba and its affiliates have been renting Times Square in Causeway Bay as their headquarters. Due to business expansion, including its subsidiary Ant Group and media operations, they occupy a total of 10 floors, with the lease expiring in 2028.

Alibaba's performance shows that for the first quarter of the 2026 fiscal year ending June 30, revenue was RMB 247.652 billion, a year-on-year increase of 2%. During this period, net profit rose 78% year-on-year to RMB 43.116 billion. With strong performance, the group also has ample funds to purchase its headquarters.

Industry insiders expect that Alibaba is looking for a new Grade A office building in the same area for long-term use as its headquarters. The Island One Center is a waterfront project, and if they acquire half of the building, they are likely to gain naming rights and rooftop advertising space, which would positively impact the group's image, hence the interest in acquiring multiple floors of the building.

If the amount involved in this transaction is approximately HKD 7 billion, it will break the record set in March this year when the Hong Kong Stock Exchange (00388) purchased the highest 9-story office building (usable area of approximately 147,000 square feet) at Central Trading Plaza for HKD 6.3 billion, making it the largest office building transaction of the year.

It is reported that the project was formerly the Hong Kong East Hotel. In 2017, during the peak of Grade A office buildings, the Mandarin Oriental Group put the East Hotel up for tender, attracting bids from local developers and mainland enterprises. However, the group ultimately reclaimed it and announced plans for redevelopment, officially closing the hotel in 2019, with an investment of approximately HKD 5 billion

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