Developer's plan to build luxury homes challenges perceptions of older district
Kerry Properties has outbid 10 rivals to win the contract for the Urban Renewal Authority residential redevelopment in Sai Ying Pun estimated to cost $2.5 billion.
This is the developer's first residential project in the aged Western District, where property consultants expect the MTR Corp's proposed West Island line extension to prompt large-scale redevelopment in coming years.
The new MTR line, scheduled for completion in five years, will add three new stations - University, Sai Ying Pun and Kennedy Town. The line will cut travel time between Sheung Wan and Kennedy Town by at least half.
Kerry Properties, which beat blue-chip property players such as Cheung Kong (Holdings), Sun Hung Kai Properties, Henderson Land Development and Sino Land in the public tender, said the project at First Street and Second Street in Sai Ying Pun would yield 600 two and three-bedroom units.
It will also have 100 car-parking slots and an unspecified amount of retail space.
With a site area of about 38,000 square feet, the project will yield a gross floor area of about 425,000 sq ft.
The project will include an 11,800 sq ft home for the elderly and about 7,500 sq ft of landscaped open space.
Kerry Properties, which focuses on luxury residential properties, said it would cultivate a 'luxury home' image for the project in the old district.
The developer did not disclose its expected investment costs but property consultants and developers estimated the project's value at $2 billion to $2.5 billion.
Alvin Lam Tsz-pun, associate director of Midland Surveyors, said Western District was poised for dramatic change with the introduction of the new MTR line.
Developers would speed up the pace of redevelopment in the district, he said.
But Mr Lam wondered whether Kerry Properties could really market its development as a luxury project due to its location, noting its proximity to a wet market.
Mr Lam projected that selling prices for the finished project could exceed $5,000 per sq ft when marketed within one or two years.
Kerry Properties is part of the Kerry Group, the largest shareholder in SCMP Group, which publishes the South China Morning Post.