Sun Hung Kai Properties splashes out US$2.2 billion in one day on land in Hong Kong, Guangzhou in bold bet on Greater Bay Area
- The Hong Kong developer outbid rivals to win a parcel in Kwu Tung for a price 40 per cent higher than the market valuation, signaling its confidence in the local market
- It also won several plots adjoining the terminus of the high-speed rail link in Guangzhou for 7.08 billion yuan (US$1.09 billion) on the same day
It also won land comprising several plots adjoining the Guangzhou South Railway Station, the terminus of the high-speed rail link connecting the southern mainland city and Hong Kong, for 7.08 billion yuan (US$1.09 billion) on the same day.
Hong Kong’s Lands Department said late on Tuesday that it had awarded the site in Kwu Tung in northern New Territories, close to the Lok Ma Chau Control Point bordering Shenzhen, to Asset Capital Limited, a unit of Hong Kong’s biggest home builder, Sun Hung Kai Properties.
The plot, with a gross floor area of 1.19 million square feet, sold for HK$7,184 per sq ft, which should translate to as much as HK$20,000 per sq ft for completed homes after factoring in profit margin, according to Vincent Cheung, managing director of Vincorn Consulting and Appraisal.
In comparison, lived-in units in Valais in neighbouring Sheung Shui – another Sun Hung Kai Properties project – sell for HK$11,929 per sq ft.
“The winning price is surprisingly high and the only explanation is that the developer is extremely confident in Hong Kong’s housing market and is betting on a sharp increase in the next three years,” said Cheung.