Two site tenders expected to reflect cautious bidding by developers
Surveyors expect the results of tenders for two small residential sites in Tuen Mun and Sha Tau Kok will show that developers bid conservatively for the sites because the prospect of an increased supply of houses is making them cautious about the price at which they acquire more land.
A spokesman for the Lands Department said yesterday a site in Tuen Mun that was up for auction attracted 10 bidders, while five developers joined the bidding for a site in Sha Tau Kok.
The bidding closed yesterday and results of the tender could be released next week.
"The response was good, particularly for the Sha Tau Kok site. But that doesn't mean the offers will be high," said James Cheung, an executive director at Centaline Surveyors.
"Developers have turned cautious in their land acquisitions since there has been an increase in the number of sites released for sale and housing supply will increase significantly in two to three years' time. So they believe home prices will come under downward pressure."
Both sites were also far from the city centre and the site in Sha Tau Kok was in a closed area. Therefore, only people with closed-area permits would be able to visit the area.
Cheung estimated the site could have fetched a top bid of HK$104 million or HK$800 per square foot.
The bidders included Sino Land, Far East Consortium and Wang On.
The site could be developed into a residential project with a maximum gross floor area of 129,577 sq ft. The building height has been limited to six storeys and the project must provide at least 240 flats.
The second site, at Wu Hong Street in Tuen Mun, covers an area of 24,014 sq ft.
The bidders included Sino Land, Emperor International, K Wah International and HKR International.