Reduced-price luxury units in Shanghai fail to attract investors

The Hang Lung Group says it has received a weak response from investors to its luxury residential project Hanson Garden in Hongkou, Shanghai, despite prices being one-third cheaper than nearby projects.

Hang Lung (China) director Charlie Lin said only a few units of the development had been sold through property agents since it went on sale in November.

He partly attributed the weak response to the Lunar New Year period, when sales usually were slow.

The development's selling price was about US$1,200 per square metre (about HK$862 per square foot).

'This price already took into account the Asian currency crisis and stock market crash when it went on sale,' Mr Lin said.

'But Southeast Asian buyers felt mainland properties [were] more expensive after their currencies had suffered a sharp devaluation.' Mainland property sales had slowed because many Southeast Asian companies were forced to suspend their plans to expand abroad after the region's financial turmoil, he said.