New | Chinese developers aggressively bidding for government land in Hong Kong

A joint venture led by state-owned China City Construction recently entered Hong Kong’s property market, paying a record high price for a residential site in Ma On Shan.

The crown for highest price lasted all of five months .

Another mainland Chinese company, CITIC Group, came along and grabbed a nearby site in the same area for HK$1.469 billion, or HK$6,500 per sq ft, breaking the record HK$5,517 per sq ft set earlier by China City Construction.

The pair are part of 10 mainland developers who setting new benchmarks in land prices in Tuen Mun, Kai Tak and Tsuen Wan as they entered Hong Kong’s land market at a breakneck pace since 2013.

They have spent HK$14 billion in gobbling up government sites in Hong Kong for the first nine months this year, exceeding the HK$11 billion value for the whole of 2014 and HK$ 8 billion in 2013, according to data from the Lands Department compiled by the South China Morning Post.

The entry of mainland giants are set to change the balance of power in the Hong Kong land market as they account for a quarter of the HK$134 billion in government land sales revenue.

Whether the entry of cash-rich Chinese developers marks the end of a Hong Kong property market dominated by a few local giants remains to be seen, but a new era is definitely here. Mainland developers are dramatically changing Hong Kong’s property landscape, providing more choices in the city’s housing market.