Major Hong Kong property developer CK Asset Holdings said on Thursday (Jul 13) its HK$20.8 billion (S$3.52 billion) deal to sell a luxury residential development to a Singapore fund had lapsed after it did not receive the first part payment.

CK Asset sold the development to ORIC-Borrett Limited, a fund owned by Sino-Suisse, in September in the financial city’s largest single residential deal.

The developer said in a filing the buyer had failed to pay the first part payment of HK$1.04 billion and the accrued interest, so it terminated the sale agreement on Thursday and forfeited the HK$2.1 billion deposit paid by the buyer.

“After the signing of the agreement, there were continuous changes in the market and interest rates. Even though both parties have tried to ... study different proposals to solve the problem, an agreement could not be reached,” company executive director Justin Chiu said in a separate statement.

Chiu said the company would put the development on the market again.

Hong Kong private home prices fell again in May following four months of gains, as many home buyers stayed on the sidelines amid uncertainty over interest rate hikes and the economic outlook.

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Home prices in the city, which are among the most expensive in the world, fell 15 per cent last year in the first annual drop since 2008, with very few transactions in the luxury segment, property agents said.

CK Asset added the collapse of the deal would not have a material adverse impact on its business and financial position. REUTERS