Hong Kong land sale

Murray Road is first grade-A site in Central to go on sale in 20 years

Knight Frank expects prime spot to fetch as much as US$2.4 billion, or US$5,150 per square foot

PUBLISHED : Friday, 17 March, 2017, 8:14pm
UPDATED : Friday, 17 March, 2017, 10:38pm

The government is to kick off the tendering process for Hong Kong’s first grade-A commercial site in Central in 20 years, as record prices continue to be paid in the city, especially by mainland developers.

The plot, on Murray Road, is one of the two commercial sites put out to tender on March 31, Lands Department said on Friday.

Thomas Lam, a senior director at Knight Frank expects the prime site to fetch as much as HK$18.6 billion (US$2.4 billion), or HK$40,000 per square foot.

“The site will certainly attract lots of interest among developers, as new office supply in Central is rare,” he said.

The site, expected to yield a total gross floor are of 450,996 sq ft, could generate bids of between HK$35,000 and HK$40,000 per sq ft, the equivalent of HK$15.7 to HK$18.6 billion, said Lam

In the 2016/2017 financial year, mainland developers have won six government sites for HK$48 billion, and a further plot next to Wong Chuk Hang Station, bringing their total spend on major land acquisitions to HK$52.7 billion.

Chinese companies have also snapping up 42 per cent of all new lettings the city’s Central financial district, according to industry experts.

Surveyors expect the site at Murray Road – currently used as a car park – to attract fierce bidding as Hong Kong and mainland developers battle it out for prime headquarter sites in Central.

The tender for the Murray Road site will start on March 31 and close on May 12.

The Lands Department also announced tender invitations on Friday for another commercial site at Kai Tak, the site of the city’s former airport, will start on March 31 and close on May 26.

Kai Tak Area 1F Site 2 is expected to yield a total gross floor area of 1.91 million square feet, which Lam valued at between HK$13.38 and HK$14.34 billion, or HK$7,000 to HK$7,500 per sq ft.