Going into service
Chinachem Group's futuristic residential tower at 129 Repulse Bay Road may finally have found its niche
Whether you've driven past it, or looked up at it from the beach, you won't have missed the awe-inspiring tower at 129 Repulse Bay Road — or the fact that it has been empty since completion in 2002. Urban myth had it that the building was destined to house the secret police (something that was backed up by the gleaming Gotham City-style architecture) but in fact, the developer, Chinachem Group, has simply been waiting for the right time to cash in on its investment.
According to the latest blueprint, the lily-shaped monolith will be converted into a serviced-apartment project. There will be no land premium payable for the conversion of the 24-storey residential building, which comprises 184 units. Duplexes currently come in at around 3,400 square feet, single apartments between 1,715 square feet and 1,930 square feet.
Response is expected to be high since The Repulse Bay (Dericou) at 109 Repulse Bay Road and Hong Kong Parkview are the only developments on the South-Side now offering serviced apartments. Occupancy rates average between 80 percent and 90 percent.
"There's a definite market for it, and units will likely be priced accordingly," says Anne-Marie Sage, regional director of Jones Lang La Salle's residential department. "The average rent at The Dericou is HK$37 per square foot, with monthly rentals ranging from HK$70,000 to HK$86,000. It seems likely that prices at 129 Repulse Bay will go higher."
In taking the serviced apartment route, Chinachem is supplying certain demand: serviced apartments are scarce all over Hong Kong, particularly in the boutique category, where single executives are renting on a long-term basis. "The market is so busy at the moment," says Sage, "everyone is full and there are waiting lists. At the top end —HK$80,000 through to HK$100,000 [per month] —there is minimal stock."
Since young professionals will likely prefer accommodation in town — if they can find it — demand is expected to be highest for the larger "family" apartments at 129 Repulse Bay Road. At the onset of their sojourn overseas, relocating families, who have picked out homes and schools in the South-Side area, are expected to take advantage of the short-term leases (and five-star facilities) on offer.
Without ever housing a single resident, 129 Repulse Bay Road has rung in the changes over the past five years. The site was bought for HK$5.55 billion (HK$16,275 per square foot) in 1997, and Chinachem planned to sell off the 184 units for HK$30,000 per square foot on completion in late 2002. But the Asian financial crisis got in the way. By 2002 prices in the area had dropped to around HK$10,000 per square foot — and development plans were put on hold. In January 2004, the company received government approval to convert the property into a 352-room, six-star hotel but plans were shelved in 2006 when a higher-than-expected land premium was imposed for the conversion. With South-Side property prices back to HK$30,000 per square foot, the company's focus returned to residential.
Late chairman, Nina Wang intended 129 Repulse Bay Road to be Chinachem's flagship residential development, but at least by entering the serviced-apartment sector it looks destined to house families (even temporarily) and rake in the dividends long term.
|
.jpg)
