bodyType

customContents

entityId

entityUuid

articlePageQuery

filter

article

articleBaseAdvertisingInfoArticle

articleListArticle

articleSeoArticle

hooksArticleAcknowledgementGateOverlayArticle

hooksTrackPageViewArticle

hooksContentInterestArticle

articleLinkingDataContent

hooksAmpRedirectArticle

articleSchemaContent

liveArticle

advertZone

sentiment

contentLock

topics

types

sections

paywallTypes

createdDate

publishedDate

urlAlias

moreOnThisArticles

sponsorType

commentCount

authorLocations

authors

corrections

displaySlideShow

multimediaEmbed

printHeadline

seriesContainer

articleSpeeches

socialHeadline

headline

images

flag

firstTopic

glossary

flattenTypeIds

image

relatedLinks

relatedNewsletters

__typename

sponsor

pdfFiles

seriesReverseOrder

series

disableOffPlatformContent

published

updatedDate

summary

subHeadline

body

keywords

readingTime

customTimezone

liveContents

MTR Corp has received a cool response from developers for the tender of residential development at Choi Hung Station amid a sluggish real estate market and harsh tender conditions.

Only four developers submitted their bids when the tender closed yesterday.

Three of the bidders are Sino Land, Nan Fung Development and Hantec Investment, a sister company of Macau developer Polytec Group. A fourth bidder is believed to be a contractor.

Big guns such as Sun Hung Kai Properties, Henderson Land Development, New World Development, Wharf (Holdings), Amoy Properties and Kerry Properties said they had not submitted bids.

This was in sharp contrast to the strong initial interest expressed by more than 20 developers in January for the project.

However, MTR Corp property director Thomas Ho Hang-kwong said he was satisfied with the tender results, considering the project was a small development with technical difficulties to be resolved.

Developers said the higher construction cost for the park-and-ride and residential complex, together with the requirement that developers guarantee a fixed profit to MTR Corp, had increased investment risk.

Mr Ho said MTR Corp required a fixed profit from the project because of the technical complexity of the project, and adopting the usual profit-sharing scheme would add administration cost.

New World Development senior manager of property development Andrew Choi said total investment for the project would be a minimum of HK$900 million, higher than the HK$800 million estimated by MTR Corp.

He said developers were required to build various public facilities such as carports and bridges, which increased the investment risk.

Mr Choi estimated that finished properties at the development needed to sell at as high as HK$3,700 per square foot to break even.

Analysts expected that the cool response might prompt MTR Corp to consider offering more favourable tender conditions for other projects, especially the upcoming residential projects on the Tseung Kwan O MTR extension.

One option under consideration is that MTR Corp will bear the land premium before releasing the projects for tender.

For the Choi Hung project, developers are required to pay a HK$20 million bond and a HK$207 million land premium.

The Choi Hung project is on a 34,983 square-foot site, covering the existing Ping Shek bus terminus on Clear Water Bay Road and an adjacent vacant lot.

It can provide 184,398 sq ft of residential floor area, 25,833 sq ft of commercial area, 450 public parking spaces, 51 private parking spaces and a two-storey public transport interchange.

The Government will buy back the two-storey public transport interchange facilities for HK$61.8 million on completion. The private car parking spaces will be managed by the MTR, which will share 51 per cent of the profits generated from the spaces.



MTR residential development attracts four bidders for demanding project in slow market