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SHK Properties clinches HK$8b Tseung Kwan O development

Sun Hung Kai Properties has won the contract to undertake MTR Corp's HK$8 billion mixed development project in Tseung Kwan O, beating three other developers.

The tender for the Area 56 project closed on February 8 with Sun Hung Kai Properties, a consortium led by Cheung Kong (Holdings), Henderson Land Development and Wheelock Properties submitting bids. MTR announced the result yesterday.

The site is above the Tseung Kwan O station and next to Sun Hung Kai Properties' Central Heights residential project.

A property agent said Central Heights had about 60 high-level units still available, with an average asking price of HK$4,800 per square foot.

New Tseung Kwan O residential projects fetch between HK$4,400 and HK$4,500 per square foot, according to Ken Lee, a senior district sales manager of Centaline Property Agency.

Prices for the latest project could reach HK$4,800 per square foot, as it included a hotel and office development, Mr Lee said.

The hotel could be four-star with an average room rate of HK$1,000 a day, while the office units could fetch rents of HK$10 a square foot, surveyor Albert So Chun-hin said.

The hotel and office development could take longer to break even as Tseung Kwan O was not a commercial district, he said.

The 430,452 square foot site could provide a gross floor area of 1.8 million sq ft and will be the only development project with hotel and office space in the district.

The project will have two 36-storey hotel and office towers with 1,290 guest rooms and four 42 to 45-storey residential blocks with 1,150 units.

Meanwhile, Cheuk Nang (Holdings) yesterday triggered an auction for a Cheung Chau residential site on the land application list.

The 111,752 sq ft site in the south of the island can provide a gross floor area of 44,692 sq ft. It will be offered for sale on March 27.

The Lands Department has accepted a minimum guaranteed bid of HK$39 million or HK$873 per square foot for the site.

Centaline Surveyors director James Cheung said the project was worth HK$67 million, or HK$1,500 per square foot.

He expected the project to fetch at least HK$2,500 per square foot after completion.