Yesterday, after New World Development, a major real estate company in Hong Kong, announced its first annual loss in 20 years, Adrian Cheng officially resigned as the company’s CEO. Cheng, who had led the company for four years, will be succeeded by Chief Operating Officer Eric Ma, effective immediately.
In a filing submitted to the Hong Kong Stock Exchange, the company explained that Cheng stepped down to focus on public service and personal matters, but he will continue to serve as non-executive vice chairman.
It is known that New World Group was founded by Dr. Cheng Yu-tung in 1970 and listed on the Hong Kong Stock Exchange in 1972. The group’s businesses span hotel operations and department stores, making it one of Hong Kong’s major developers.
In addition, New World Group has been actively engaged in various businesses in Mainland China, becoming one of the major foreign direct investors. The group’s investments in Mainland China exceed $17 billion, covering four municipalities and over 20 provinces. New World Department Store Group is the group’s retail flagship in Mainland China, with a chain network of department stores and shopping centers across 12 key cities in China, introducing several internationally renowned beauty brands such as La Mer, La Prairie, and Helena Rubinstein.
In Cheng’s resignation statement, he also emphasized that he will continue to be involved in guiding the business strategies of New World’s K11 project, a commercial venture focused on art and retail. The innovative K11 shopping mall, launched by Cheng in 2008, saw an 11.9% revenue growth. New World aims to further expand K11’s presence in Mainland China by opening new locations in Shenzhen, Ningbo, and Hong Kong.
Apart from real estate investments, Cheng is also well-known for his involvement in the art and fashion world. Recently, he acquired a majority stake in the luxury streetwear brand 1017 Alyx 9SM.
In the fiscal year ending June 30, New World Group posted a loss of 19.7 billion HKD ($2.53 billion). Revenue plunged by 62% to 35.78 billion HKD ($4.58 billion). As a result, the company plans to sell approximately 13 billion HKD ($1.67 billion) worth of non-core assets, including the Qianhai Tower project in Shenzhen, to reduce its debt burden.
