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Hong Kong stamp duty

Sale of Jordan and Tseung Kwan O attract flurry of bids

Strong interest in two residential plots reveals price cooling taxes have not deterred developers

PUBLISHED : Saturday, 08 December, 2012, 12:00am
UPDATED : Saturday, 08 December, 2012, 4:21am

A small residential site in Jordan attracted an overwhelming response of 14 bids before the tender closed yesterday, reflecting Hong Kong developers' strong appetite for sites despite recent curbs to rein in home prices.

A larger site in Tseung Kwan O drew six submissions, the Lands Department said.

Surveyors estimate the two sites would fetch the government between HK$2.1 billion and HK$2.33 billion.

"The site at Kwun Chung Street, Jordan, is not a large project and has a small lump sum price tag, so it attracted many small and medium-sized developers," said Ringo Lam Chun-chiu, the valuation director of surveyors' firm AG Wilkinson & Associates.

"It's popular also because it is located in the city centre, close to Austin Road, as well as the future high-speed link and West Kowloon," Lam said.

Surveyors forecast that the 2,920 square foot site - which can yield a gross floor area of 26,275 sq ft - would cost about HK$160 million to HK$210 million, or HK$6,530 to HK$8,000 per buildable square foot.

Lam said that he expects the flats on this site to be sold for about HK$11,000 per square foot.

The 14 bidders included Sino Land, New World Development, Emperor International Holdings, Paliburg Holdings, HKR International and Wang On Group.

Wang On said the government's new 15 per cent buyers' stamp duty for corporate and non-local buyers might affect property acquisition for redevelopment purposes. Therefore, the company is trying to buy sites directly.

The six bidders at the 171,890 sq ft Tseung Kwan O site included Lai Sun Development, which went solo on this bid. The company last month joined hands with Sun Hung Kai Properties' former chairman Walter Kwok Ping-sheung to win the bidding for another Tseung Kwan O waterfront site for a higher-than-expected HK$2.83 billion.

Wheelock Properties and Sino Land were also in the fray for this land.

The government requires the winning bidder for the new Tseung Kwan O site to build at least 400 units on the lot, which can provide a total gross floor area of 429,731 sq ft.

Midland Surveyors director Alvin Lam Tze-pun said the response to the waterfront site was reasonable as a similar site also attracted six bids in the past. The firm revised its sale estimate upwards by 9 per cent to HK$2.11 million, after Lai Sun won the previous Tseung Kwan O site.

Other surveyors predicted the site to sell for HK$1.94 billion to HK$2.12 billion, or HK$4,500 to HK$4,930 per square foot.