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The tender for a large residential and commercial site above Nam Cheong station on the MTR's West Rail line is expected to draw keen interest from developers, although bidding is unlikely to be aggressive due to market uncertainty and restrictions on the site. 
The tender closes on Monday.
Surveyors estimate the site could fetch bids in a range from HK$13.04 billion to HK$15.85 billion, or HK$5,000 to HK$6,000 per buildable square foot. 
'Developers should be quite interested because it is the only MTR site among those  that will soon be available for sale that is  in an urban area. The others are in Tsuen Wan and Long Ping,' said Alvin Lam Tze-pun, a director of Midland Surveyors.  
'The fluctuations on global markets may affect bidding prices, but not developers' interest in acquiring the land parcel,' said Lam, who believes the site will sell for between HK$14.45 billion and HK$15.85 billion. 
The 497,300 sq ft site will yield a total gross floor area once developed of about 2.64 million square feet. The winning bidder will be able to  put up 14 towers of 13 to 53 storeys on the site, providing  3,313 flats, Lam said. 
To increase the supply of small and medium-sized flats, the government has required as a condition of tender that 75 per cent of the flats, 2,485, must be smaller than 538 square feet. 
The remaining 828 units can be built to an average size of 1,572 square feet. 
'The site offers extensive sea views and originally the development might have been marketed as offering some large and luxurious four-bedroom apartments. Now I think developers can build mostly two- or one-bedroom units,' said Centaline Surveyors executive director James Cheung King-tat.  
'But since the site has a prime location above the MTR station, I would not be worrying that no one is going to bid for it. Developers will adjust the land price based on what they can build on it,' he said. 
Cheung said the site was likely to fetch at least HK$13.04 billion. 
Expressions of interest in developing the site were submitted a month ago by 13 developers or consortiums to Nam Cheong Property Development, a joint venture between the Kowloon-Canton Railway Corporation and the government. 
The strong show of support came after the government simplified the tender process for sites along the West Rail line. 
Under the new arrangement, bidders will only need to propose an upfront lump-sum cash payment which covers the land premium when submitting a tender. The winning bidder will also need to give 5 per cent of profits from the site to the vendors.
This is simpler than the previous practice, which required bidders to stump up the land price, the land premium and profit share separately. 
Vincent Cheung Kiu-cho, national director for valuation and advisory services for real estate consultancy Cushman & Wakefield, said the new arrangement would make the site more attractive than it was a year ago, when the high land premium of HK$13 billion kept most developers away and left the site unbid.
Charles Chan Chiu-kwok, managing director at Savills Valuation and Professional Services, believes the site will attract no more than five bidders because its size means not many developers can afford to buy it at a time when money is tight.
He said developers would also be prudent and wait to see if the housing policies to be announced in Chief Executive Donald Tsang Yam-kuen's policy address today would further boost the supply of small and medium-sized flats, which would affect the Nam Cheong project. 
The government earlier said it planned to tender two other West Rail sites in Tsuen Wan by the end of next year and may tender another site in Long Ping early next year.
$53.7b
The price paid by developers for 20 government sites at auction and tender in the first nine months of this year



Keen interest in Nam Cheong station site