The tender of the 44-year-old Murray Building in Central, earmarked for conversion into a hotel, has attracted an overwhelming response from developers and a real estate fund keen to obtain a presence in the central business district.
The Lands Department said the government tender had generated 18 bids from large and small developers by the deadline yesterday.
"The response has been extremely good due to its prime location," said Ringo Lam Chun-chiu, a director of valuation at AG Wilkinson & Associates.
Big players including Cheung Kong and Sun Hung Kai Properties have submitted bids.
Sino Land said it had formed a joint venture with CSI Properties, Lai Sun Development and Empire Group in submitting a bid for the Murray Building.
Bidders also include Asian investment fund A&F Capital Management and small player Magnificent Estates.
Magnificent chairman William Cheng Kai-man said the company was attracted by the prime location of the building.
Surveyors forecast developers would bid HK$2.27 billion to HK$3.25 billion, or HK$7,000 to HK$10,000 per square foot, for the building.
"The bid is subject to developers' plans such as what kind of hotel and how many rooms they want to have," Lam said.
Alvin Lam Tsz-pun, a director at Midland Surveyors, said the Murray Building site enjoyed a great geographical location and full sea view. It is expected to attract bids from developers and hotel operators.
Located at 22 Cotton Tree Drive, the 27-storey building has a maximum gross floor area of 325,073 sqft.
According to the tender document, the winning bidder is required to maintain the building's exterior structure.
The developer is allowed to use up to 70 per cent of the gross floor area for hotel rooms and the remaining 30 per cent for entertainment and retail purposes.