Owners of Merry Terrace agree to joint deal
Mid-Levels plan gets 90pc support in largest collective sale
In the largest attempt at a collective property sale, owners of more than 176 of the 196 flats in Merry Terrace in Mid-Levels agreed to put the estate up for tender in January next year, surpassing the 90 per cent support needed to compel the rest of the owners to sell.
Surveyors expect the 52,466 square foot site to fetch about HK$4.6 billion or HK$9,741 per square foot.
The supporting owners have signed a binding joint disposal agreement and appointed property consultant Jones Lang LaSalle to handle the tender, according to Nicholas Chiu, a member of the Merry Terrace development committee.
The tender for the flats held by consenting owners will be open from January 2 to March 1.
Under the law, once 90 per cent of owners in a building agree to sell, a developer can apply for a court order seeking the auction of the remainder.
As the supply of residential sites in traditional luxury districts is limited, property consultants expect many major developers to be interested in the property.
Built in 1963, Merry Terrace is at 4A-P Seymour Road and comprises five 14-storey residential towers with 196 units and a saleable area of about 202,944 sqft, according to property consultant Jones Lang LaSalle.
With a plot ratio of nine, it can be turned into a luxury residential project more than double the current size, providing a gross floor area of 472,194 sqft, or about the size of nearby Robinson Place.
No land premium is payable by the winning developer for the redevelopment since the government lease of the site is unrestricted.
However, surveyors noted that since the winner would not take ownership of the whole building, the company could be stuck with additional interest expenditure and legal expenses if it has to apply for an auction through the Lands Tribunal.
Raymond Tam, the head of the conveyancing department at Li, Wong and Lam Solicitors, said it might take at least a year to complete the acquisition if the tribunal was called in.
The latest transaction price at Merry Terrace was about HK$6,400 per square foot in terms of usable area last year.
A surveyor said the price of property at the Merry Terrace redevelopment project could reach HK$16,000 per square foot after completion.