Fortune Real Estate Investment Trust (Fortune REIT) has announced its plans to buy Hong Kong-based two retail properties, viz. Belvedere Garden Property and Provident Centre Property, for HK$1.9 billion.

Fortune REIT said it had plans to acquire Belvedere Garden Property for HK$1.25 billion and Provident Centre Property for HK$650 million. Both figures represent discounts to their independent valuations.

As per a Knight Frank valuation report, Belvedere Garden Property and Provident Centre Property had appraised values of HK$1.3 billion and HK$680 million respectively, as of September 30 this year.

Net property yield from Belvedere Garden Property and Provident Centre Property has been estimated at 5.2 per cent and 4.8 per cent respectively.

Chairman Mr. Chiu Kwok Hung, of ARA Asset Management (Fortune) Ltd, said that the new potential purchases would provide it with growing and more diversified income.

Speaking on the topic, he said, "The new properties provide Fortune REIT with an additional source of stable and growing rental income, as well as a more diversified income and tenant mix."

Mr. Chiu added that there was plenty of room to enhance the efficiency of the two retail properties.

The acquisition of the retail properties will have to seek approval of independent share holders at an unusual general meeting, which is expected to take place on January 19, 2012.