Lohas Park home prices get a lift, thanks to the Sun Hung Kai Properties effect
Sun Hung Kai Properties, Hong Kong’s largest developer by market value, usually sets a new price benchmark when it launches projects and Tseung Kwan O’s Lohas Park, where prices have been capped by its proximity to a landfill site and lack of commercial facilities, is no exception, say property experts.
Last Wednesday SHKP released the price list for the first 208 units at Wings at Sea, about a 10 minute walk to MTR’s Lohas Park station, with the average discounted price being HK$12,788 per square foot – the highest launch prices in the area where close to 10,000 units are under construction. Prices for the second batch of 105 flats announced on Saturday were 10 per cent higher, an average of HK$14,063 per sq ft, as they offered sea views.
For years, the price growth at Lohas Park, built on reclaimed land east of Tseung Kwan O, has lagged behind housing estates along Hong Kong’s other subway lines.
“Prices per square foot for used flats at Lohas Park are still about HK$3,000 to HK$5,000 cheaper than those at Tseung Kwan O’s city centre. There is the opportunity for it to increase by HK$2,000 to HK$2,500,” said Vincent Cheung, deputy managing director of valuation and advisory services at Colliers.
“The existing price difference between Lohas Park and other areas offers room for increase,” he said.
Including Wings at Sea, about 10,000 new flats across seven projects have been approved for development at Lohas Park, but Cheung said the high supply would not greatly affect property prices.
“The effect of high market supply has been expected and reflected in prices already, but the price difference compared to other regions leaves little room for a drop in prices there,” he said.
Lohas Park prices have lagged behind other developments along railway lines by more than 30 per cent since phase one launched in 2008. Other factors keeping prices lower are the location of the landfill nearby and the lack of shops and amenities, according to Cheung.
But prices in the area have been catching up over the past couple of years.
Ken Lee, principal regional sales director at Centaline Property Agency, said Lohas Park prices have risen more than 20 per cent in the past 12 months compared to about a 10 per cent gain for flats in towns located along other railway lines, such as Po Lam.
He pointed out that the current price of HK$12,000 per sq ft was still “way below” other areas.
Lee said SHKP’s strong brand helps boost property prices and it was able to change the public’s general perception of Lohas Park with this Wings at Sea project. A similar effect was seen with the developer’s Park Yoho project in Yuen Long.
“Compared to other developers, buyers in general are willing to pay a premium for SHKP’s flats due to their relatively better quality,” Lee said.
The first batch of 208 flats at Wings at Sea offer unit sizes ranging from 340 sq ft to 1,132 sq ft, with prices starting from HK$4 million.
The 1,040-unit development, due for completion in 2019, has received more than8,500potential buyers register their interest.
When completed in 2025, the entire Lohas Park region will comprise 21,500 flats and population of 58,000.