$5.36b benchmark expected as commercial and luxury sites offer rich pickings in latest auction list The disused Central Market, described as the jewel in the crown among 35 sites the government has released in its new land application list, could fetch as much as $5.36 billion, which analysts say would set a new benchmark for the sector. Developers are licking their lips at the prospect of securing the 0.42 hectare site - earmarked for office, retail or hotel development - in the wake of rising commercial and hotel property values and rare new supply in core Central. Property analysts estimate the site will be sold at between $4.7 billion and $5.36 billion, making it one of the most valuable sites on the list in lump-sum terms. Three other sites expected to fetch a combined $18 billion are a 1.77 ha plot in Oil Street, North Point, a 1.05 ha site in Borrett Road, Mid-Levels, and a 2.39 ha site in Mount Nicholson Road, on the Peak. The Central Police Station in Hollywood Road is another key site. The government says the sale of the 29 residential sites and six commercial sites, which analysts estimate could be worth $65 billion, could create 11,000 flats. The government yesterday also introduced a simplified application procedure, shortening it to seven weeks from 10 weeks from the date the developer applies to when the site is offered for sale. Director of Lands Patrick Lau Lai-chiu said: 'We have offered a variety of sites: from big to small; from luxury, mass housing to commercial. We hope to meet the market's need.' Mr Lau said the measures catered to public calls to speed up land sales, which has been criticised by developers for long delays. Developers and analysts generally approved of the new list, saying the government had made efforts to meet market needs. However, they worried the small number of commercial and luxury sites in the list might not satisfy growing demand. Four of the commercial sites, including the one in Central, are allowed for hotel use. Great Eagle Holdings has emerged as one of the most interested developers in the Central commercial site. 'If there are sites on Hong Kong Island that can be developed into a hotel, we will definitely take part in the bidding,' Great Eagle deputy chairman Lo Ka-shui said. The have been no government site sales in Central for about 10 years. The last Central commercial site sold, now housing Citic Tower on Tim Mei Avenue, was by tender in 1995 at $3.3 billion. BNP Paribas Peregrine regional property analyst Adrian Ngan Wai-hung said the government had not put enough genuine luxury sites on the application list. 'Only two luxury sites [Mount Nicholson and Borrett Road] are available on Hong Kong Island,' said Mr Ngan, who expected supply of luxury sites would remain tight in the next four to five years while in overall housing supply it would be three years. The Oil Street site was put on the list last year but was not triggered for sale as developers failed to meet the government's target price. Industry participants said the revised application procedure did not go far enough to boost efficiency and transparency. 'The direction is right but there is still room for improvement,' said Tony Chan Tung-ngok, an executive director of Vigers Appraisal and Consulting. 'The market concern is the lengthy negotiations between developers and the government on the reserve price as there is a lack of transparency in the system. So this problem is still unsolved.' The new application procedure consists of four measures, including enhancing transparency by revealing the number of site applications on the Lands Department's website on a monthly and site-specific basis. The government will require developers pay a deposit of only 10 per cent of its bid price for a site up to a maximum of $50 million. The existing minimum is $10 million. Applicants will also be required to submit their formal agreements and deposits with the initial site-trigger application in a bid to cut two weeks off the process. At present, deposits must be paid only after a successful application. Public notice of a land auction will also be shortened from three weeks to two.