Henderson Land

Henderson Land buys two sites in Wan Chai

PUBLISHED : Saturday, 12 August, 2006, 12:00am
UPDATED : Saturday, 12 August, 2006, 12:00am

Henderson Land, Hong Kong's third-largest developer by market value, has bought two old buildings in Wan Chai for HK$825 million to boost the company's land bank.

Henderson, which outbid Chuang's Consortium and four other developers for 93 per cent ownership of Kam Kwok Building and National Building, has to negotiate with the remaining owners or wait a year before applying for compulsory acquisition to be processed to gain complete ownership.

The winning bid fell short of the HK$1.5 billion asking price due to divided ownership offsetting the rarity value of the site, analysts said.

The 15,955 square feet site of the two 45-year-old buildings, near Sun Hung Kai Centre and Sun's Group Centre, is zoned for commercial or residential use and can be used for office, hotel or residential purposes. Kam Kwok Building is at the junction of Gloucester Road and Marsh Road and National Building is at the junction of Jaffe Road,

If used for a residential project, the bid price comes in at HK$5,170 per square foot and can provide residential gross floor area of 159,550 sqft under the existing ordinance. Henderson can get 'a reasonable profit' if it obtains HK$7,500 per square foot for flat prices, surveyors said.

'The site is close to the waterfront and commercial area of Wan Chai and the project could fetch HK$7,500 per square foot after completion,' one surveyor said. 'J Residence at Johnston Road, developed by K Wah International, fetched HK$7,000 per square foot to HK$8,000 per square foot last month.'

The site also has the potential for an office building with a gross floor area of 239,325 sqft.

The site was put up for tender in June and closed on July 25.