Property/ Hong Kong & China

Cooling measures unlikely to affect sale of residential sites at Hong Kong's Tseung Kwan O and on Peng Chau

Surveyors say the sale of two sites at Tseung Kwan O and on Peng Chau won't be affected

Yvonne Liu

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Published: 12:00am, 19 Sep, 2012

Updated: 3:17am, 19 Sep, 2012

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The latest policy measures aimed at curbing the rise in property prices will have little impact on the outcome of this week's sale of two residential sites at Tseung Kwan O and on Peng Chau, say surveyors.

The tender for the sites closes on Friday.

Centaline Surveyors' director James Cheung King-tat said measures targeting the market - including the planned release of remaining Home Ownership Scheme (HOS) flats for sale, and tighter lending conditions on second mortgages announced by the Hong Kong Monetary Authority, would have only a limited impact on bidding for the sites.

"I don't think the measures will have much effect on the tender responses," he said.

"The Peng Chau site may attract both investors and end-users, and even though Tseung Kwan O is one of the major sources of new housing supply, I think developers have digested the news, and the site up for tender there is in a good location."

"Flats on the new sites will only be completed after 2015. The property market and interest rates may be in a different place at that time.

Cheung believed the Tseung Kwan O site would be sold for around HK$2.19 billion, or HK$4,500 per sq ft. The Peng Chau site would fetch around HK$23 million, or HK$1,600 per sq ft.

Vincent Cheung Kiu-cho, national director for greater China at valuer's Cushman & Wakefield, echoed this view.

"I think the Tseung Kwan O site is worth HK$2.19 billion or HK$4,500 per sq ft. Second-hand flats in the area sell for HK$7,000 to HK$8,000 per sq ft and even if the winning bidder for the site were to sell the project at the same price as second-hand homes, they won't lose money."

He estimated the Peng Chau site was worth HK$24.4 million or HK$1,700 per sq ft.

The Tseung Kwan O site is located in a new residential area in front of the Tseung Kwan O MTR Station covering an area of 139,019 sq ft. It could yield a total gross floor area of 486,565 sq ft.

Under the restrictions on the land lease imposed by the Lands Department, the winning bidder has to build at least 520 flats and not more than 546 flats. The building height has been limited to a maximum of 65 metres (about 21 storeys).

The 19,160 sq ft Peng Chau site could yield a total gross floor area of 14,372 sq ft. The building height has been restricted to two storeys and six metres.