HK developers retain appetite for land banks

Interest shown in site near Yuen Long MTR station seems to defy latest cooling measures

PUBLISHED : Thursday, 06 September, 2012, 12:00am
UPDATED : Thursday, 06 September, 2012, 3:59am

Sixteen developers yesterday expressed interest in a residential site on the north side of Yuen Long's Long Ping MTR Station, suggesting that cooling measures were not affecting their appetite for land.

Cheung Kong (Holdings), China Overseas Holdings, Hang Lung Properties, Henderson Land, Kerry Properties, Nan Fung Development, New World Development, Paliburg Holdings, Sun Hung Kai Properties, Sino Land, The Wharf (Holdings) and Wing Tai Properties were among those submitting expressions of interest in the project.

"It shows developers have not turned pessimistic on the market outlook after the government released new measures for the property market last week," said Vincent Cheung Kiu-cho, national director of Greater China at Cushman & Wakefield.

"The measures showed the government will increase land supply in the mid and long terms. Unless there are unfavourable terms in the land lease, developers would remain active in land acquisitions.

"Developers are now looking to maintain a strong sales volume rather than achieving a higher selling price."

Chan Cheung-kit, a director at Lanbase Surveyors, believed developers would be conservative in bidding as the land supply was increasing.

"Developers have to submit expressions of interests in order to receive the tender document for the site," he said.

"It is normal that so many developers submitted expressions of interest. But I think their offers will be conservative."

The 106,564 square feet site located to the north of Long Ping MTR Station could yield a total gross floor area of 523,938 sqft.

Government restrictions mean the site has to provide at least 832 flats and 75 per cent of the units must be less than 538 sqft.

Cheung estimated the site to be worth about HK$1.68 billion or HK$3,200 per sqft.

"The site is located in the Yuen Long Tung Tau Industrial Area. I think the price will be cheaper than a nearby site in residential area [acquired by Cheung Kong] that sold for HK$3,629 per sqft in March last year," he said.

Alvin Lam, a director at Midland Surveyors, estimated the site was worth HK$1.9 billion or HK$3,600 per sqft.