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Membership prices at Hong Kong’s most exclusive private clubs have fallen by as much as 20 percent on the secondary market in the past year, brokers say, as the city’s economy slows and affluent expats and residents leave the Chinese territory.
The Asian financial center’s private members’ clubs have been an integral part of the business community since the British colonial era, with some institutions enjoying significantly lower rents under agreements that have been in place for decades.
Rules vary, but individual and corporate club memberships typically require a hefty payment and sometimes a long wait. Prices on the secondary market for memberships took a hit during the pandemic, as the territory’s strict zero-Covid policies drove many expats and residents out of the city. Prices have continued to fall even after Hong Kong’s lockdown rules ended.
Secondary market asking prices for a membership at the Aberdeen Marina Club, a 40-year-old private club that covers 550,000 square feet and operates seven restaurants and sports and family facilities including an ice rink and bowling alley, fell nearly 20 percent to about HK$2.75 million (US$350,000) from about HK$3.4 million in early 2023, according to two brokers who trade private club memberships. Before the pandemic, such memberships would have cost up to HK$4 million, they said.
According to Everfine Membership Services, another broker, members of the Hong Kong Cricket Club, founded in 1851, are now changing hands for about HK$1.1 million, down from HK$1.4 million early last year .
At the Kowloon Cricket Club, memberships are changing hands on the secondary market for about HK$900,000, brokers said, compared with more than HK$1 million early last year. Membership at the Discovery Bay Golf Club fell to HK$2.8 million from more than HK$3.1 million in the same period, they said.
The sense of crisis among the city’s clubs came to light this month when the nearly century-old American Club asked its non-US members to pay as much as HK$1.5 million to maintain their membership or leave the club. exit, a move designed in part to preserve its nonprofit tax status. The club reversed this after a negative response from members.
“The desire for memberships has been hit by the poor economic sentiment,” said Bena Wong, a membership consultant at Fuji Consultants, a brokerage that trades private club memberships. “People are no longer spending money.” Fewer mainland residents were seeking memberships thanks to China’s economic slowdown, he added.
The downsizing or departure from territory of some multinationals, which often have corporate memberships, has also put pressure on prices. The number of companies with regional headquarters in Hong Kong fell last year from 1,541 in 2019 to 1,336 last year.
“The market has been quiet,” said Tony Chan, sales director at Everfine Membership Services. “Some members have moved overseas, while companies have set up bases elsewhere.”
“The second-hand market is a good reflection of the economy,” said a former Hong Kong banker who is a member of four private clubs.
French bank Natixis predicts Hong Kong’s economy will grow 2.6 percent this year, after a weaker-than-expected 3.2 percent growth last year.
Authorities in the area are trying to attract more wealthy individuals and professionals, including by offering tax breaks for family offices.
The Hong Kong government in March restarted a capital investment immigration program for those willing to invest HK$30 million in the city, which has attracted many mainlanders, even though the program is only open to mainlanders who are permanent residents of a foreign country are.
“The weak economy has taken its toll [on membership prices],” said Raymond Kwok, founder of real estate agency BA Marketing & Co. “But when prices fall to a certain level, they will stabilize and possibly recover.”