Tenders expected to draw cautious response
Developers are expected to be cautious in bidding for the two residential sites, in Sha Tin's Kau To and Yuen Long, that were released for tender yesterday, say surveyors.
The tender will close on August 30.
The Kau To site located at Lai Ping Road covers an area of 354,136 square feet and could provide a total gross floor area of 323,308 sq ft.
The Lands Department in recent years has released several sites in the area, which is expected to be developed into a new luxury residential district.
In the last transaction in the area, in March, Sun Hung Kai Properties bought a residential site for HK$1.42 billion, or HK$10,885 per square foot - a record in the area.
Surveyors, however, estimate the new site will range between HK$2.91 billion and HK$3.07 billion, or only HK$9,000 to HK$9,500 per square foot.
James Cheung, an executive director at Centaline Surveyors, said: "I have lowered my estimation of the site from HK$10,000 to HK$9,000 per square foot as the Tseung Kwan O waterfront site sold at a lower price last week.
"Developers won't bid aggressively for the Kau To site."
Surveyor Albert So Chun-hin said he expected the price would range between HK$9,000 and HK$9,500 per square foot.
"Although many sites in the area have been sold, there aren't that many development plots in Hong Kong suitable for luxury residential development," So said.
"Developers would still be interested in the site, but the price would be flat."
The other residential site released for tender is located at Tak Yip Street in Yuen Long's Tung Tau Industrial Area.
It covers an area of 46,317 sq ft and could yield a maximum gross floor area of 231,587 sq ft.
Under the new restrictions of the Lands Department, the site has to provide at least 430 flats.
"The site is next to industrial buildings and not close to Long Ping MTR Station," said Alvin Lam, a director at Midland Surveyors. "I believe it is worth HK$648 million, or HK$2,800 per square foot.
"As the development scale is small, this site will also attract small developers in the bidding,"
In the last transaction in Yuen Long, Chinachem Group won a site to the south of Long Ping MTR Station for a lower-than-expected HK$1.3 billion, or HK$2,876 per square foot.
The 90,396 sq ft site will provide at least 720 flats.