Residents select houses at a sales center of a real estate company in Huaian, East China's Jiangsu Province on Sunday. As China's domestic coronavirus control has made progress, local real estate companies have opened while observing strict measures against the virus. Photo: cnsphotos

Hong Kong real estate tycoon Li Ka-shing came under spotlight on Wednesday as his former real estate company, sold in July, was prohibited from receiving financing, loans or help that supports major asset restructuring by the finance regulator for reported offense of land hoarding.

The Bureau of Finance of Chengdu Hi-Tech Zone (CDHT), Southwest China's Sichuan Province, issued a notice to financial institutions in the area on Wednesday, asking them not to provide new financing, loans or help to support major asset restructuring for Hutchison Whampoa Properties (Chengdu) Limited, media reported, citing a document released by the bureau.

Hutchison Whampoa Properties (Chengdu) has engaged in improper land and property hoarding, which seriously affected the stable development of the regional real estate market, said the bureau.

CK Asset Holdings Limited said later on Wednesday that Hutchison Whampoa Properties (Chengdu) Limited had been sold to Yuzhou Group and Chengdu Ruizhuo Real Estate in July, each holding 50 percent shares, with an announcement on HKEX.

Li is the senior advisor of CK Asset Holdings and CK Hutchison Holdings Limited since 10 May 2018. Prior to his current position, Li had been chairman.

CK Asset Holdings reiterates that all development projects of the company are carried out in strict accordance with national laws and regulations and there is no case of land hoarding. 

A source from Yuzhou Group said that the bureau's punishment is aimed at the original shareholder, namely Li's CA Asset Holdings. The company's acquisition of Hutchison Whampoa Properties (Chengdu) is not affected, chnfund.com reported.

The move of Hutchison that has annoyed the CDHT's regulators may be linked to the Nancheng Duhui project, the 21st Century Business Herald said, quoting a source from a financial institution in Chengdu.

Hutchison Whampoa Properties (Chengdu) has purchased the land of Nancheng Duhui project in 2004 for a total price of 2.135 billion yuan ($312.8 million), with the gross floor price of 1,030 yuan per square meter.

The phase 7 and phase 8 of this project are still not for sale, while the project was last opened four years ago. The price was between 12,000 yuan ($1,766) and 16,000 yuan per square meter in 2016. Now, the price in the same area has surged to 23,000 yuan to 25,000 yuan per square meter, nearly twenty-fold of the original price.