The Metropolis, a joint venture between Cheung Kong (Holdings) and Kowloon-Canton Railway Corp (KCRC), should set a barometer for commercial values in Hunghom.
Analysts said the sale of a waterfront commercial site in the vicinity for a lower-than-expected HK$1.09 billion at last week's government auction did not accurately reflect market values.
They said the properties on the site would be finished in three or four years and the price of The Metropolis could be a better gauge. But some had reservations because they expected limited competition for the project.
Cheung Kong was in talks to buy KCRC's interest in The Metropolis, a 1.4 million square foot project being built in two phases. As a result of a value dispute, the project would be sold by tender.
Phase one, just completed, comprises a 700-room hotel, a 15-storey office tower, 360,000 sq ft of retail space and 200 parking spaces - totalling 1.04 million square feet. Phase two will provide two towers of serviced apartments with 377,000 sq ft to be finished by the first half of next year. The commercial complex was estimated to have a value of more than HK$3 billion.
Nicholas Brooke, consultant of Insignia Brooke, estimated the price for Hunghom offices would be about HK$3,000 per sq ft, with a guaranteed rental yield of 6 per cent to 7 per cent.
FPDSavills Kowloon and Hong Kong commercial director Maggie Chu said the latest reference for sea-view office rentals in Hunghom could be a transaction in Chinachem Golden Plaza in Tsim Sha Tsui East at HK$17 per sq ft.
