A joint tender from Sino Land and Chinese Estates Holdings has won the contract for the Urban Renewal Authority's single biggest project: the rejuvenation of Kwun Tong's rundown town centre.
The alliance, in which Sino Land holds a 90 per cent stake and Chinese Estates 10 per cent, outbid five other tenders, from Cheung Kong; Henderson Land Development; Sun Hung Kai Properties; Great Eagle and another consortium of Wheelock Properties, Nan Fung Development and New World Development.
The successful tender follows an earlier aborted exercise, after which the URA relaxed the terms for sale of the land.
The project's 1,700 flats will help the government meet its annual target of 20,000 flats, said Alvin Lam, a director at Midland Surveyors.
Lam said it was difficult to estimate the total investment cost as it involved profit-sharing with the URA and requirements for public facilities. In general, he said, the estimated land cost in Kwun Tong would be HK$5,500 per square foot.
To generate interest, URA last month revised the terms of the proposed development by dropping the HK$8 billion entry fee. The new terms allowed the winning developer to propose how much it was prepared to pay for the entry fee plus profit-sharing.
The Sino-Chinese Estates consortium will have six years to complete non-residential parts of the project and public facilities, compared with four years and eight months under the initial tender. But there was no change to the URA's plan to buy back the retail portion for HK$1.8 billion.
In addition to the gross residential floor area of about 138,980 square metres, the new development aims to deliver some 33,220 square metres of shops, a public transport interchange, a hawkers' market, a refuse collection point and public open space of about 6,400 square metres.