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38.Operating lease arrangements

The Group as lessor

Property rental income earned during the year was HK$264,975,000 (2009: HK$250,726,000). The properties held had committed leases mainly running for the next one to six years.

Contingent rental income was calculated based on the excess of certain percentage of revenue of the relevant operation that occupied certain of the properties over the fixed portion of the monthly rentals. Contingent rental income earned during the year ended 31 December 2010 is HK$567,000 (2009: nil).

At the end of the reporting period, the Group had contracted with tenants for the following future minimum lease payments in respect of investment properties which fall due as follows:

2010 HK$000

2009 HK$000

Within one year In the second to fifth years inclusive After five years

204,635 326,755 69,331

193,368 343,543 16,268

600,721

553,179

Where leases are negotiated at a fixed rate for the first few years, but subject to renegotiation for the remaining contracted lease terms, the minimum lease payments are calculated based on the latest negotiated rent, if any.

The Group as lessee

2010 HK$000

2009 HK$000

Within one year In the second to fifth years inclusive

12,429 13,639

46,631 4,684

26,068

51,315

At the end of the reporting period, the Group had outstanding commitments under non-cancellable operating leases in respect of rented premises which fall due as follows:

Operating lease payments represent rentals payable by the Group for certain of its office premises. Leases are negotiated for term of one to three years and rentals are fixed over the respective leases.

Annual Report 2010

145

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