Kerry Prop cancels $1 bln China property project

HONG KONG, Jan 15 (Reuters) - Kerry Properties (0683.HK) and sister firm Shangri-La Asia (0069.HK) said on Thursday they had cancelled a 7.3 billion yuan ($1.1 billion) hotel and property project in northern China due to poor market conditions.

Kerry said the venture will pay 21 million yuan or 0.3 percent of the total planned investment to Tangshan City Land Resources Transactions Centre, as a penalty for cancelling the purchase of the land use rights of the project sites in Hebei province's Tangshan city.

Shares in Kerry Property fell 4 percent and Shangri-La lost 6.8 percent, underperforming a 3.4 percent drop in the benchmark Hang Seng Index .HSI. (Reporting by Alison Leung; Editing by David Holmes) ($1=6.834 Yuan)