Faced with a higher-than-expected land premium and up-front payment on MTR Corp's Hang Hau Station property, developers say they have been cautious in bidding for the project.
Sources said the offers some developers made were not generous and at least one did not propose to share any profit with the MTRC, a term that has usually been included in the past.
For example, New World Development and its consortium partners outbid six consortiums last year for the Tseung Kwan O Town Centre Station development right by offering MTRC more than 50 per cent profit sharing.
The Hang Hau Station project tender closed on Monday and the winning bid is expected to be announced in a couple of weeks.
'Developers can hardly afford to offer keen bids this time as the basic terms required by MTRC will squeeze their future profit margin,' one source said.
MTRC required the committed developers to pay HK$350 million up-front and a HK$60 million renovation fee, to surrender the ownership of a 37,600 square-foot shopping mall to MTRC and to bear the Government's HK$1.27 billion land premium.