“There’s a gap between the price expectation of the bidders and the seller,” said Vincent Cheung Kiu-cho, Colliers International’s deputy managing director for Asia valuation, who values the 848-room hotel at between HK$25 billion and HK$27 billion.

Mandarin’s shares plunged by as much as 32 per cent on the Singapore exchange to US$1.89 after the announcement, their largest intraday tumble on record.

Mandarin decided to put the 44-year old hotel on the market in June, a month after a government sale of the Murray Road site in downtown Central set a world record for the most expensive commercial property by square footage.

The site of the Excelsior, which has been approved by zoning authorities for redevelopment into commercial offices, was estimated by surveyors at between HK$24 billion and HK$34.2 billion, or between HK$35,000 and up to HK$50,000 per square foot, with a total gross floor area of 684,000 square feet (63,545 square metres).

Other Hong Kong property owners had also been testing the waters. Great Eagle Holdings, the property developer controlled by the Lo family, was looking to sell its landmark Langham Place Office Tower in Mong Kok for HK$25 billion. The Center office tower, the tallest building in the portfolio of Li Ka-shing’s CK Asset Holdings and the fifth-tallest in Hong Kong, is also reportedly up for sale for over HK$35 billion.

“Hong Kong developers are cash-rich, they have no financial pressure to sell their assets,” said Thomas Lam, senior director at Knight Frank. “They are just testing the water, and I believe the demand for grade A commercial towers at prime locations is still very strong as they are rare on the market.”

Market conditions had changed in the city since May. Chinese companies like HNA Group, which had been rapacious buyers of real estate assets since 2015, were forced to stay on the sidelines by a Chinese government crackdown on overseas acquisitions, and tighter scrutiny on borrowings.

The sales withdrawal was an unexpected setback for the operator, which announced on September 15 that it had received proposals from potential buyers and was reviewing them. Its shares rallied by 32 per cent over seven days after the announcement. Bidders included Sun Hung Kai Properties, Hysan Development and a joint venture between Chinese Estates Holdings and China Evergrande Group, according to reports.

A four-star hotel, the Excelsior opened in 1973, and is best known to local residents and tourists for its history as part of Hong Kong’s colonial past.

The site that it occupies was originally a warehouse of the British conglomerate Jardine Matheson, located on Gloucester Road across the Royal Hong Kong Yacht Club around the corner from Victoria Park. The Noonday Gun, a former naval artillery piece that’s fired every day at noon, is located opposite the hotel.

It was the favourite spot of Hong Kong’s high society, including the late Sir Run Run Shaw, founder and former chairman of the city’s premier broadcast television network TVB. David Tung Wai, a broker and a close friend of Shaw, remembered the hotel well.

“Run Run and many financial market friends liked to go there for meetings or drinks in the old days,” Tung, 88, said in a June interview with the South China Morning Post. “I particularly liked its live band and dance floor on the top floor. We had a lot of good time there. It’s sad to hear it being put up for sale.”

The 1978 comedy Revenge of the Pink Panther by the late Peter Sellers was partly filmed at the Excelsior, and the hotel was the venue for a 1977 concert by Van McCoy, best known for his 1975 international hit The Hustle.