New World win third business site in Cheung Sha Wan within six months, this time or for HK$2.97b

Other bidders included Sino Land, Sun Hung Kai, Cheung Kong Property, and Wheelock, but bidding overall was dominated by Hong Kong developers

PUBLISHED : Thursday, 17 August, 2017, 8:45am
UPDATED : Thursday, 17 August, 2017, 8:45am

New World Development has beaten eight other competitors to win its third business – for either office or retail use – site in Cheung Sha Wan, raising its investment in the area to nearly HK$15 billion (US$1.92 billion) in the past six months.

The Lands Department awarded the site at the junction of Wing Hong Street, Yu Chau West Street and Wing Ming Street in Kowloon, to Bonson Holdings, a wholly subsidiary of New World Development, for HK$2.97 billion, at the top-end of market expectations.

The high price indicates local developers remain upbeat about the market outlook
Alvin Lam, director at Midland Surveyors

The price represents HK$7,995 per square foot, which is at the higher end of market forecast which ranged from HK$2.6 billion to HK$3 billion, or HK$7,000 to HK$8,000 per sq ft.

“Three sites bought by the same developer indicates the group’s confidence in the district,” said Victor Lai, chief executive of Centaline Professionals.

The other bidders included Sino Land, Sun Hung Kai Properties, Cheung Kong Property Holdings, and Wheelock Properties, but bidding overall was dominated by Hong Kong developers, on account of the rigid controls that are making it more difficult for capital to flow out of China.

“The high price indicates local developers remain upbeat about the market outlook,” said Alvin Lam, a director at Midland Surveyors.

The keen competition for the 30,925 sq ft site, means it is likely to yield a total gross floor area of 371,100 sq ft, given its proximity to MTR’s Cheung Sha Wan station, he said.

In May, New World Development beat seven rival developers with a HK$4.03 billion (US$52 million) bid to win its second plot in Cheung Sha Wan, after it secured the first one for HK$7.79 billion in February.

A residential site at Cheung Sha, on Lantau Island, has been awarded to Golden United Development for HK$210 million, said the Lands Department.

The price translates into HK$19,667 per sq ft, and the site attracted eight bidders. It is expected to yield a total floor area of 10,678 sq ft.

“The Lautau site is situation to allow a low-density, luxury project,” said Lai.

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