The selling price is 3 per cent higher than the $2,834 per sq ft set on the first 100 units.

Property agents said owners of uncompleted flats trying to sell units would be unable to compete with the prices set - as low as $1.76 million - by Paliburg.

They also said flats in the second-hand market would pose little or no threat as they were selling for considerably more than Park Royale.

Second-hand flats in properties such as Sun Hung Kai Properties' (SHKP) Parkside Villa are selling for about $3,600 to $3,800, according to agents.

They predicted a healthy response to the sale, thanks to the prices tags of less than $2 million on most of the offered flats.

At the same time, they said investors were likely to consider the project since it would offer about 5 per cent return on investment.

Eric Chan, assistant supervisor at Centaline Property's branch on Castle Peak Road, said the project would sell as long as the developer did not raise prices after selling the first batch.

Park Royale, which is due for completion early next year, consists of 10 towers and includes 680 units, of which 632 are standard residential units.

The standard units measure between 650 square feet and 950 sq ft and have an efficiency level of between 72 and 75 per cent, according to the developer.

The development also includes 24 duplexes and 24 penthouses, each measuring between 1,600 and 2,000 sq ft, which will be sold later, according to the company.

Some agents were more cautious in their assessment of the project, saying sales activity in Yuen Long had been quiet for some time.

They said the depressed state of the Hong Kong property market was the result of the economic slump, high interest rates and growing unemployment.

While prices might be right, they said the economic climate could have a dampening effect on sales.

Some agents also wondered how many people would pay the premium associated with buying a new flat considering the depressed state of the economy.

Paliburg has introduced five payment plans, including a second mortgage, to help purchasers.

The developer also is offering sweeteners to buyers, including a free car-parking space to the first buyer and reduced prices on a parking space to the first 10 buyers.

Paliburg also said it would waive legal fees and offer complimentary tickets to a poolside party for the first 300 registered buyers.

While sales activity in the Yuen Long area has been depressed recently, agents said there should be a good response to this project.

FACT FILE Development: Park Royale in Yuen Long Developer: Paliburg Holdings Flats on sale: 250 Size: 650-950 square feet Average price: $2,834 per square foot Sale: June 13 Total flats: 680 units Latest completion date: July 31, 1999 Facilities: Deluxe clubhouse with outdoor swimming pool with waterfall, mini-golf course, tennis court, BBQ site, fitness centre, sauna and steam rooms, children's play facilities, etc.