Cheung Kong

New projects from Cheung Kong, SHKP to fight it out in Tseung Kwan O

Cheung Kong and SHKP are poised to launch new projects for sale in the district, which is expected to lure East Islanders who want to upgrade

PUBLISHED : Tuesday, 05 August, 2014, 4:38pm
UPDATED : Wednesday, 06 August, 2014, 3:28am

Hong Kong's two largest developers, Cheung Kong (Holdings) and Sun Hung Kai Properties, will battle for buyers in Tseung Kwan O, where they are poised to launch new projects for sale.

Hot on the heels of the successful launch of its Mont Vert development in Tai Po, Cheung Kong will sell flats at Hemera, its joint-venture project with Nan Fung Development.

Sun Hung Kai Properties deputy managing director Victor Lui Ting plans to launch The Wings IIIA once it obtains presale consent from the Lands Department this month.

The two developments could provide a total of 2,608 flats. "The projects are expected to catch the attention of upgraders, who are interested in buying a bigger flat," said Aaron Mak, a sales manager at agency Hong Kong Property, said. "However, since The Wings IIIA offers one-bedroom and two-bedroom flats, it will also attract investors."

Property agents said the 1,648 flats at Hemera, Phase IIIA of Lohas Park, will mainly provide three-bedroom flats rather than one- or two-bedroom flats. Hemera's location is better than those of the previous phases, because it is above Lohas Park MTR station.

The Wings IIIA, south of the Tseung Kwan O MTR station, offers 960 flats. About two-thirds of the units are medium-sized and small flats with one to three bedrooms. The remaining flats have four bedrooms. The minimum saleable floor area of the one-bedroom flats is 334 square feet.

"Housing demand in Tseung Kwan O is very strong, particularly for three-bedroom flats. Many young families from the area plan to buy a bigger flat," Mak said.

The new projects in the district sold over the past few years also attracted upgraders from Island East, and Mak expects the same to happen this time.

"They were attracted by the new flats because there is a lack of new housing in Island East," Mak said. "Price is another attractive factor. If they sell their flat in Island East, it is enough for them to buy two flats in Tseung Kwan O. Many buyers sold their flat in Island East and then used part of the money to buy a flat in Tseung Kwan O."

Sammy Po Siu-ming, chief executive of Midland Realty's residential department, said the market response would depend on the asking prices.

"Buyers are very smart and price-sensitive," Po said. "For example, the sales of some single-block new projects on Hong Kong Island were not active, because they were asking a premium price. But the sales of projects with asking prices less than those of second-hand flats are very strong."

Agents say the average price at Lohas Park is about HK$8,500 per square foot, while the prices of flats in the previous phases of The Wings range between HK$13,000 and HK$17,000 per square foot.

Upcoming housing supply in the area would be a major concern for buyers, because Tseung Kwan O will contribute the largest housing supply of any district this year and next.

Data from the Rating and Valuation Department shows there will be 17,610 flats completed in Hong Kong this year, of which about 14 per cent will be in Tseung Kwan O. About 17 per cent of the 12,660 flats scheduled for completion next year will be built there. The district's new housing supply has already reached 4,617 flats in two years.

MTR Corp awarded the fourth phase of Lohas Park, with 1,600 flats, to SHKP in April. The remaining phases of Lohas Park will be released in the next few years, adding to housing supply in Tseung Kwan O.

The abundance of new flats could limit potential increases in prices, especially in a down cycle.