Small Hong Kong developers lure buyers with special home designs

At a time when price discounts and tax subsidies have become the norm for developers to draw buyers to new projects, Hanison Construction Holdings is banking on the additional attraction of a "modern London home" concept of spacious double-bedroom units to win home sales.

Hanison, spun off from HKR International for a separate stock listing in 2002, plans to launch the Austine Place, a 42-unit single-block development on Kwun Chung Street in Jordan on Sunday. Ten units will be offered for sale in the first batch.

Hanison's launch comes as other major developers including Wheelock Properties, Kerry Properties, Nan Fung Development and Henderson Land Development are also offering new projects across the city.

"The market has plenty of supply, but there is a lack of flats with big bedrooms," said Hanison's executive director, Matthew Chow Ka-fung, who sees it as an opportunity for the company to differentiate its products.

Property agents said developers had been looking for ways to stand out in the competition as the market was about to be awash with fresh supply.

"Pricing, however, is still the No1 factor influencing buying decision," said Sammy Po Siu-ming, the chief executive of Midland Realty's residential department.

Po believes developers will offer flexible pricing options for projects in districts that face a supply surge, with some undercutting the secondary market.

"Second mortgages arranged by developers will also help first-time buyers and upgraders finance their purchases," he said, adding that cash subsidies on the stamp duty would be necessary.

According to Credit Suisse, this year has been fruitful for major developers. About 13,990 units were available this year, of which more than 10,500 have been sold by November 17, raising HK$116 billion.

The biggest revenue earners were City Point in Tsuen Wan, Grand Austin at Austin MTR Station, Mayfair By The Sea I and II in Tai Po, Double Cove in Wu Kai Sha and Riva in Yuen Long.

More than 4,300 units were expected to be launched by the end of next month, said a report released by Credit Suisse last week, as a number of large-scale projects hit the market, such as Hemera in Tseung Kwan O by Cheung Kong (Holdings) and Century Link in Tung Chung by Sun Hung Kai Properties.

Meanwhile, Nan Fung is launching Homantin Hillside in Hung Hom and Wheelock will sell Parkside in Tseung Kwan O.

Hanison said yesterday the first 30 units at the Austine Place would be priced at an average HK$20,781 per square foot after discounts.

A nearby property, the Austin, is priced at more than HK$20,000 per square foot.

"It's taking a risk," said Chow, on whether buyers would warm to the idea of forking out HK$15 million to more than HK$20 million for the developer's two-bedroom units.

Po said that for HK$20 million or above, most buyers preferred three-bedroom units. But flats with unique characteristics such as great view, spacious bedrooms and good design would draw certain buyers.

Another developer, Wing Tai Properties, said it included a hotel concept in its residential development, the Pierre, in Sheung Wan.

Despite the uniqueness of projects such as the Austine Place and the Pierre, pricing will remain the crucial factor.

Credit Suisse expects developers to price their launches competitively, especially for districts in Yuen Long, Tseung Kwan O, Tsuen Wan and Kai Tak, where buyers have lots of choices.

Yuen Long is expected to provide 11,400 units in the next five years. Tseung Kwan O will see 9,200 units come on stream and Tsuen Wan 5,000. Kai Tak will provide about 4,300.