The building of an exceptional attraction
Anna Healy Fenton
There is compelling evidence that the market wants residential developments that are rare, unique and exceptional, like the Opus, says Martin Cubbon, chief executive of Swire Properties. 'It's what seems to characterise the Chinese consumer. We deal with them in our retail complexes on the mainland: it's very much what they go for.'
This trend is evident in all areas of consumer society, Cubbon says. 'Why on earth would you pay US$6,000 a case for a poor year of Chateau Lafite? Why are there so many Rolls-Royces and Lamborghinis in a place like China that has got speed limits and so on? So things which have that rareness, that clear distinction, there's strong demand for.' Opus, he says, ticks all those boxes, 'plus it's very usable, very attractive ... in a very important, vibrant financial centre.'
Is Swire looking mainly to mainland customers for Opus? Cubbon shakes his head but concedes he expects most customers to be Chinese, with interest so far from established Hong Kong locals. These have tended to be middle-aged and able to appreciate an apartment that has an element of art as well as just usage. 'Most people who are interested have got to acknowledge that.'
On the question of selling or leasing the Opus, Swire intended to hold on to some units, with some leased, and, if an exceptional offer is received, some might be sold. 'Then, we would look at it seriously, but we're not going to sell it for anything other than a very significant price, probably a premium on other residential apartments in Hong Kong,' Cubbon says.
Would they consider selling the whole block? 'Never say no, but that's very, very unlikely.' Cubbon thinks the market is ready for flats with an identity, which is why Frank Gehry was chosen for the Opus. 'I think that's probably been there for some time, but the expedient has been, you know, draw out the maximum commercial value, which doesn't always get something that's different, unique, exceptional, artistic, whatever.'
Gehry was chosen because he could do something commercially compelling. 'I mean, it's a great site, it's not just that it's on The Peak on upper Stubbs Road, it's on this promontory which gives it a 270-degree view, due east, due west but also southeast and southwest.' To make the most of the site, it could not be a design that was a simple rectangular block. Challenges included building a new road, fortifying the slope behind it, and orienting the building to maximise the views.
As Gehry describes it, Opus Hong Kong is loosely drawn in the shape of the bauhinia flower, with a series of 'flowers' that fold round the stem. 'It may seem like a weird thing to do, putting the structural support columns on the outside of the building, but amazingly it's worked.'
Nevertheless Swire took a risk, Cubbon insists. 'The easiest thing to do would be to build a rectangular block, and clearly it would have sold, and it would have been cheaper, but actually the overall value proposition is increased by having something so unusual, so special.'
Cubbon sees no evidence of a property bubble at the moment. 'When you've got measures imposed by central government, what with Beijing and Hong Kong, which are designed to suppress demand, it tells you it's unlikely there's a bubble,' he says. It is quite sensible he thinks, it is about suppressing demand. If this were removed, more transactions, at least in the short term, and higher prices would be the result. 'I don't think the market's rigged, it's not just a function of supply and demand, the government is a little bit later than they should have been, and are now looking to put more supply out there. That eventually will have an effect in bringing about some sort of equilibrium in pricing, but I don't think it's going to be any lower than it is now.'