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Weekend Property

Gentrification of Sheung Wan gives Hong Kong Island’s district a cool new face

Once considered cheap and cheerful, the area has undergone transformation into hipster central, with rentals and property prices to match

PUBLISHED : Friday, 14 April, 2017, 10:00am
UPDATED : Friday, 14 April, 2017, 10:00am

Hong Kong Tourism Board promotes Sheung Wan as “a travel through time”, where “age-old traditions of yesteryear” prevail, and dried seafood and Chinese herb shops may be found still “bursting with life today” – which of course is all true.

There’s the 1906-built Western Market, a declared monument; the self-explanatory Dried Seafood Street; and Ko Shing Street, wholesale centre of Hong Kong’s thriving herbal medicine trade.

But gentrification has given the district a brand new, uber-cool face. Now it’s the place to hang out, because there’s nowhere else quite like it.

Forbes has described Sheung Wan as “one of Hong Kong’s coolest neighbourhoods”, and Natural Geographic and Lonely Planet – and locally-based Hong Kong visitor guides – offer walking tours of an inner-urban gem where “the past and the future converge”.

As the original Chinese trading hub of Hong Kong Island, Sheung Wan district started to prosper in the late 19th century. The British had arrived in 1842 and, as nearby Central began to take shape as the principal European business district, Chinese merchants moved westwards to ply their traditional trades.

Apart from accommodating their businesses, Sheung Wan became a low-cost – and increasingly crowded – residential area for Chinese traders, relocated to make way for European arrivals. Until quite recently, Sheung Wan was still considered a rather cheap if cheerful place to live at the heart of the urban action, but that’s changed now that the secret’s out. The district today is still eclectic, crowded, convenient and a dead-set cultural buzz, but it’s no longer cheap. As one resident laments on a local expat blog, “it used to be cheap, but Sheung Wan is getting increasingly hip and expensive”.

Indeed, Sheung Wan today is hipster central. Walking around one of the coolest places in Hong Kong, there are artisan cafes on almost every corner, hidden bars, galleries, studios and street art, juxtaposed with temples, curios vendors and the dried seafood/herbal remedy shops.

Edina Wong, head of residential leasing at Savills, says Sheung Wan started to change about four or five years ago, when developers and commercial renters cottoned on to the cheaper price of real estate there.

The MTR extension has made a big difference, especially since the University of Hong Kong is now directly connected
Edina Wong, head of residential leasing, Savills

“It’s been gradual,” she explains. “We saw quite a number of collective sales whereby owners of small blocks got together and sold [their plots], on which developers rebuilt modern high rises.

“And then the shops came in. Rentals were a little less expensive for premises still close to the escalator, which appealed to the smaller cafes and delicatessens.” Real estate prices have risen as a natural progression, Wong says.

“Compared to five years ago, the [price] change has been quite dramatic,” she says. “But the cheaper rentals were in older buildings, mostly walk-ups. Now you have 30-storey buildings with facilities, a view, and top-notch fit-out.”

Sheung Wan is still more affordable than Mid-Levels, Wong points out, although it attracts a different demographic. “The housing consists of smaller apartments, more for younger couples. It’s not really an area for families.”

So, who lives there? According to Ingrid Cheh, senior manager of the research department at JLL, more than 40 per cent of households in Sheung Wan are considered high-income earners (earning HK$40,000-plus). The split of owner-occupiers and tenants is approximately 50:50, and of these, about 63 per cent are either singles or couples, according to data from the latest population census.

Cheh attributes the high percentage of small-sized families and single-person households to the locality’s proximity to workplaces, as well as the retail and entertainment amenities in the vicinity. “The area is particularly popular among expats,” she says.

“In terms of retail and entertainment amenities, the establishment of new themed retail complexes such as PMQ and the upcoming Central Police Station also help to uplift and gentrify the Central/Sheung Wan neighbourhood,” Cheh adds.

Homes in the district are mostly mass- and medium-sized units of Class A (less than 431 sq ft), Class B (431 sq ft to 752 sq ft) and Class C (753 sq ft – 1,075 sq ft), according to the Rating and Valuation Department’s definitions.

“The price range is quite wide, depending on the age, exact location and position of the developments,” Cheh says. Recent transactions range from about HK$15,000 to HK$50,000 per square foot. “Many of these properties appeal to investors, given strong rental demand and greater affordability of expatriates,” she adds.

Supply in the district is limited. Some recent developments include 28 Aberdeen Street, a pencil-building comprised of 407 sq ft units by The Development Studio. “This project was recently launched on the sales market at prices in the range of HK$28,000 to HK$40,000 per square foot, saleable,” Cheh says. Completion is expected within this year.

“22 Staunton Street is another upcoming development by Sino Land and is expected to boast 57 Class A units with anticipated completion in 2017,” she says.

Cheh adds that gentrification has now spread further to the west from Sheung Wan to Sai Ying Pun and the Western District given the opening of the MTR West Island line.

Wong agrees that rail connectivity has greatly boosted the district’s appeal.

“The MTR extension has made a big difference, especially since the University of Hong Kong is now directly connected,” she says.