Kong Wen Wei Po News (By Leong Wai Chung)
In recent months, stock market is unsettle while property price is weaker and weaker, but developers still pursue Hong Kong Island down town land, and the related land market is still boom again the market. Shau Kei Wan Sai Wan Ho project received 16 tenders yesterday, being the second highest in the authority's history, URA (Urban Renewal Authority) published. It is rare down town land, so it is not surprise that it is popular, and besides common large developers there are many small-medium developers taking part in since the investment amount is not high, including local developer Hip Shing Hong and so on, surveyor pointed.
These 16 developers are Cheung Kong, Sun Hung Kai, Wheelock, Sino, New World, EMPEROR IHL, Hong Kong Ferry, Chuang’s Consortium, Wing Tai Properties Limited, Wang On, Hip Shing Hong, K&K Property, Chinese Estates Holdings Limited, Lai Sun Development and so on, synthesizing market information. What worth to be noticed is, Chinese enterprises who have been active in Hong Kong land market in recent years disappear this time.
The scale is small; Tender ratio is less than one half.
The project scale is small which is lack of scale effect and not suit to Chinese enterprise, ICON City valuation team director Cheong Shing Dium expressed. Furthermore, URA will consider developer's cooperation experiences, and it is difficult for Chinese financial groups which lack of experiences to bid URA land even harder than they bidding government land, so it is not surprise they not show on this bidding.
Although the reaction to this land is pointed good, but the participators number is only 42% of the letter of intents which is 38 and breaks the historical record of URA, while Ma Tau Kok Pak Tai Street and San Shan Rd project being approved in this July has participating ratio up to 62.5%, but Hong Kong Island land has location advantage. The tender number is less than prediction, and it is not likely related to recent stock market crash, but just depend on developers' consider on their own relative merits, Cheong Shing Dium pointed.
Reviewing the data, 16 tenders is only second to URA Ma Tau Kok Pak Tai Street and San Shan Rd project's 20 tenders, and same to tenders of URA Sham Shui Po Fuk Wing Street/Fuk Wa Street project in August 2008 which has built on VISTA.
The company will be careful on pricing, and they are not worry because there is still demand in the market, K&K Property administration manager Lam Yee Wah expressed after bidding. Hong Kong Island do not have much supply, and the project scale fit to the company, also they plan to supply one room or two rooms units if they win, she pointed. As for the commercial part, they preliminary plan to rent it out.
Wheelock hopes to win and make synergistic effect.
The group has project nearby and they hope can make synergistic effect, also they believe the ratio of participation in profit is reasonable and the trend will be stable, Wheelock senior manager Ho Wai Kam expressed.
Midland Surveyors director Lam Chi Pun expressed, Hong Kong Island land supply is lack, so both registration and bidding for URA Shau Kei Wan Sai Wan Ho commercial and residential project are active this time, plus with the project is in small scale with not large investment, so many large and small-medium developers are attracted
to take part in the bidding.
It is known, the project currently is Hip Shing Factory Building nearby San Shing Center, and it is in 7,642 sq ft which can be built on 64,153 sq ft commercial floor area base on plot ratio of about 8.4 times. There into the residential floor area takes 57,695 sq ft supplying about 120 units, about 50% among are units less than 480 sq ft and the same time larger than 260 sq ft (not include area of platform and terrace). Commercial floor area is 6,458 sq ft. Market predicts the floor area sq ft land price will be HKD 7,014 to HKD 9,723 and the valuation is HKD 450 million to HKD 624 million.
The project attracted 38 financial groups to submit letter of intent in earlier breaking the historical record in URA. Besides the bidding terms require, participation in profit occurs when property sale profit is up to or above HKD 127 million, in 20% for the first HKD 30 million, 30% for the second HKD 30 million, 40% for the third HKD 30 million, and up to 50% if it is more than HKD 90 million.
