The Airport Authority of Hong Kong (AAHK) made headlines with its historic bond offering of HK$18.5 billion (US$2.4 billion), the largest bond sale ever held in Hong Kong dollars.
Bloomberg reports that a historic agreement was reached late Tuesday, highlighting the financial center’s ongoing attempts to finance infrastructure projects and navigate adverse economic conditions.
Details regarding the four-tranche bond offering
The four-tranche bond offering featured maturities of three, five, ten, and thirty years, with yields of 4.05%, 4.10%, 4.25%, and 4.50%, respectively.
According to a source acquainted with the situation, the order book exceeded HK$25.3 billion due to demand from Asian investors, which included banks, asset managers, insurers, other businesses, and private banks.
According to the individual, the bond revenues will be used for ordinary business operations as well as refinancing and funding big initiatives such as the airport’s three runway system.
According to Bloomberg data, the Hong Kong dollar sale is the largest of its kind, surpassing the HK$18 billion convertible bond offering by now-liquidated developer China Evergrande Group in 2018.
HKAA has also priced 3.2 billion yuan ($436 million) in 10- and 30-year dim sum notes. On Wednesday morning, it started selling dollar notes with maturities of 3.5, 5.5, and 10 years.
Driverless service introduced in Hong Kong.
Pony.ai, a global pioneer in autonomous mobility, aims to deploy driverless transportation services at Hong Kong International Airport, Business Wire reports.
This move is a key step forward in the company’s expansion, with future ambitions to gradually roll out its robotaxi services throughout metropolitan Hong Kong, accelerating the city’s transition to smart and autonomous transportation solutions.
Challenges ahead
Despite a successful bond sale, the Hong Kong International Airport faces ongoing challenges in the aviation business.Hong Kong’s flag carrier, Cathay Pacific, has yet to reach its pre-COVID passenger capacity, and the city’s airport is still struggling to attract major international carriers.
The delayed construction of the airport’s infrastructure, including the HK$18 billion makeover, has further complicated the situation. The project, which was scheduled to be completed by 2024, is currently facing delays and is not expected to be completed until late 2025.
The airport announced plans to launch a three-runway system in November last year. Although the new north runway opened in 2022, the airport has been operating with two runways because the center runway was briefly closed for reconfiguration.
The three-runway system constitutes a significant milestone.
The completion of Hong Kong International Airport’s three-runway system marks an important step in the city’s efforts to secure its position as a major international aviation hub.
The South China Morning Post claimed that the HK$141.5 billion (US$18.1 billion) construction project, which began in 2016, is expected to double the airport’s cargo capacity and expand passenger throughput capacity by 50% to 120 million people per year by 2035.
This massive increase is especially important as Hong Kong strives to maintain its competitive advantage in the Greater Bay Area, Beijing’s initiative to integrate Hong Kong, Macau, and a number of Guangdong cities into a powerful economic center.
The enhanced system is designed to improve Hong Kong’s connectivity, make it more efficient as a transit hub for foreign tourists, and reassert its status as the key gateway for flights to and from mainland China.
“The Airport City will become an iconic landmark in the Greater Bay Area and attract visitors from all around the world,” said Vivian Cheung, acting CEO of AAHK, who also claimed that innovation was the core of the authority’s operations.
In June 2018, during the summer travel season, Hong Kong International Airport had 3,477 outgoing weekly flights, with 203 (5.8%) and 153 (4.4%) flying to Europe and the United States, respectively.
However, in the same month in 2024, the airport had just 2,617 weekly departures, with 129 (4.9%) to Europe and 79 (3.01%) to the United States.
As Indianapolis commemorates a year of significant milestones, it can look forward to new route launches and ongoing expansion in 2025.