MAGAZINE 45 MARKET WATCH

By way of an introduction, for those not familiar with it, Park Island Estate on Ma Wan is best described as Discovery Bay's baby brother. Brought into being by Sun Hung Kai Properties Ltd in 2002, it covers over 1.3 million square feet, and is now into its 31st phase.

What's on offer is a child- and dog-friendly resort lifestyle, just 25 minutes ferry ride from the hustle and bustle of Central. There's a fancy promenade, around 85,000 square feet of retail space, containing shops and restaurants, and a real community feel.

So where is it exactly? Ma Wan is an outlying island, part of the Tseun Wan district, nestled between Lamma Island and Tsing Yi Island. Inhabitation was formerly limited to a small fishing village (Tin Liu), but plans for a private housing estate came into being in the mid-1990s with the construction of the Lantau Link, connecting Ma Wan to Tsing Yi by the Tsing Ma Bridge and to Lantau Island by the Kap Shui Mun Bridge.

Before the development of the Lantau Link, which was built primarily to connect Hong Kong International Airport to the Central Business District, Tin Liu was accessible only by sampan or ferry.

Access to Park Island is now a breeze by ferry or bus, though no cars, taxis or hire cars are allowed within the development. Park Island Transport Co., Ltd operates bus services between Park Island and Tsing Yi MTR Station, Kwai Fong, Hong Kong International Airport and Tsuen Wan. It also provides ferry services to Central and Tsuen Wan West (right next to the KCR station).

While Park Island appeals to all those seeking a quiet life (boosted by full clubhouse facilities), interest is particularly high amongst airport workers who need to factor in a commute to Lantau Island. Aside from Discovery Bay, supply of resort-style residential development is limited around the airport area, and the 25-minute (HK$18) airport shuttle service from Park Island secures a steady supply of both tenants and homebuyers.

From the offset, interest in Park Island was high. At the initial presale, buyers happily paid a deposit of HK$50,000 without receiving a sales brochure or even a price list in advance. Ongoing construction was not overly affected by Sars and buyers who showed confidence in the development (and the market in general) back in 2003, have subsequently cashed in.

In the early days, most Park Island purchasers were investors looking to make a quick profit, but today 90 percent are buying for their own use. The property market is still behind that of other parts of Hong Kong but it is moving up slowly.

The average selling price for Park Island properties is around HK$4,300 per square foot. For a 650-square-foot, two-room unit with clubhouse facilities and a sea view, you are looking at paying around HK$2.8 million — a price directly comparable to that of Discovery Bay.

It's interesting to note that you would pay more than double this (at least HK$9,000 per square foot) for an old apartment without facilities or a sea view in Shouson Hill.

Unit size varies widely between the various Park Island phases though, with the exception of a limited number of 2,000-square-f00t Crystal Units, few measure over 1,000 square feet. The flats make ideal starter homes for young families and 75 percent of residents are local Chinese, as opposed to only 25 percent in Discovery Bay.

With rents currently going through the roof on Hong Kong Island, an increasing number of tenants are looking to the outlying islands, where they can find affordable homes with facilities. For these so called "rent refugees", Park Island prices are appealing and directly comparable to those in Discovery Bay and at the Gold Coast Residences in Castle Peak Bay. A 650-square-foot unit rents for around HK$8,000 per month, or HK$12 per square foot. Quite a steal when you consider that the rent on a Shouson Hill apartment averages out at HK$33 per square foot.

Despite the steady demand for Park Island property, both rental and sales prices remain relatively stable, due to the steady supply of new high-rise flats. One such is Oceancrest Phase 5b, completed last June, which comprises three blocks and 606 units. The majority of apartments measure between 620 square feet and 750 square feet, and 75 percent have a balcony. Apartments here are already in short supply, and come in at around HK$3 million.

Park Island's appeal isn't limited to its price point however. Concern for the environment is a fundamental part of the development, and Sun Hung Kai won a Gold Award (Private Housing) in the 2006 Hong Kong Eco-Business Awards.

The 24-hour battery- or liquefied natural gas-powered shuttle buses keep exhaust emissions to a minimum and energy-saving lights in common areas reduce power consumption by approximately 20 percent. Added to this of course, there's the 2 million square-feet Ma Wan theme park (opened in 2003) which is devoted to the environment, childhood development and healthy living.