Hong Kong property

Owners at two residential buildings in Tai Tam join forces, offer up buildings for collective sale. The price tag? US$482 million

PUBLISHED : Tuesday, 12 June, 2018, 5:04pm
UPDATED : Wednesday, 13 June, 2018, 7:48pm

Taking advantage of Hong Kong’s skyrocketing home prices, a group of 28 owners at a luxury residential development in the Southern District of Tai Tam agreed to offer their flats for a tender through collective sale at an indicative price of HK$3.78 billion (US$481.75 million).

The 43-year-old Faber Court, located at 29-31 Tai Tam Road, could be redeveloped into either houses or flats.

“It is a rare opportunity to have a luxury residential site put on sale,” said Danny Chan, regional director of Capital Market at JLL which has been appointed as the sole agent to sell 100 per cent of the undivided shares of the property.

The 41,500 square-foot site is occupied by two seven-storey apartment buildings, comprising a total of 28 full sea-view units of about 2,000 sq ft.

With a maximum plot ratio of 0.9 time for houses, the site could yield a total gross floor area of 37,350 sq ft, while apartment buildings could generate a maximum floor area of 58,100 sq ft at a plot ratio of 1.4 times.

The asking price of HK$3.78 billion translates into HK$101,204 per sq ft if the buyer redevelops the site into houses or HK$65,060 per sq ft for a development with flats.

“Each with their unique street number, private garden; swimming pool and private driveway can be built on two contiguous lots,” he said.

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Chan said the site could be redeveloped into two ultra-deluxe detached houses, each with a site area of 18,765 sq ft that could go for HK$200,000 to HK$300,00 per sq ft.

Alternatively, he said two luxury apartment buildings with each unit of around 7,000 to 9,000 square feet can be built on the plot.

Prices for brand new luxury homes could fetch HK$100,000 per sq ft considering short supply in prestigious locations, Chan said.

With the two available plot ratios on neighbouring lots, he said more innovative designs – such as a combination of house and apartment complex – may also be considered.

After the completion of the sale, each owner would receive as much as HK$135 million, compared to HK$55 million being offered by individual owners in the market currently.

The tender will close at midday on August 29.

Thomas Lam, a senior director of Knight Frank said the plot offered for collective sale would generate a high valuation as it offered a redevelopment opportunity.

“Many buildings in Southern District and on The Peak are very old. As individual owners cannot afford to redevelop by themselves, it may mean more owners opt for offering their units for collective sale,” Lam said.