Better life in boom town
- Regeneration continues in Kai Tak and Kwun Tong as developers snap up valuable land in a district that has changed dramatically over the past decade
Promising a superior quality of life, Kai Tak is now halfway through its transformation into one of Hong Kong’s most liveable districts, combining commercial, residential, recreational and more than 100 hectares of green space.
Infrastructure work and community facilities in Kai Tak, including two primary schools, a community hall and a district cooling system, are now finished.
The Kai Tak MTR station, which is part of the Sha Tin to Central rail, is expected to begin operating in 2019.
A proposed monorail system, a multi-purpose sports complex, the Kai Tak waterway and further infrastructural works are now at the planning stage.
Also included in the broader Kowloon East regeneration scheme, nearby Kwun Tong is undergoing a large-scale facelift, with the Kwun Tong Town Centre Project set to give the former industrial area a new lease of life.
Since the completion of the De Novo residential project in Kai Tak by the Urban Renewal Authority in 2016, six other residential projects have followed.
One Kai Tak I and II by China Overseas Land & Investment, Victoria Skye by K&K Property Holdings, K.City by K.Wah, Vibe Centro by Poly Property, and most recently, Oasis Kai Tak by Wheelock Properties, have added to the landscape.
Residential property sales, largely new homes, across Kai Tak amounted to around 900 deals in the past 12 months to September 2018, according to Land Registry records, with an average price per square foot of about HK$26,600.
At Wheelock Properties’ Oasis Kai Tak, a luxury duplex arranged over two lower floors, at 1,502 square feet, sold for around HK$45.6 million, or HK$31,000 per square foot, in May.
In May, Sun Hung Kai Properties bought Kai Tak Area 1F Site 1, which is next to the planned MTR station, for a whopping HK$25.2 billion, equivalent to HK$17,776 per square foot. This represents a record for land in Kai Tak sold by the government.
Sun Hung Kai Properties’ deputy managing director Victor Lui said the prime site, which offers direct access to the MTR and nearby shopping centres, would be best turned into a landmark mixed-use residential and commercial project.
In March, Wheelock Properties made a deal with the distressed HNA Group, making a commitment to buy a development project in Kai Tak Area 1L Site 1 for HK$6.36 billion, or HK$15,000 per square foot. Before that, Henderson Land snapped up two nearby plots from HNA for HK$16 billion, or HK$15,000 per square foot.
After quickly offloading three Kai Tak sites, by October 2018 HNA still held the Kai Tak Area 1L Site 2 plot, which they bought in March 2017 for HK$7.44 billion, or HK$13,500 per square foot.
In October, the Hong Kong government announced it would be putting two more Kai Tak sites up for sale in the final quarter of 2018, but as the US-China trade war lingers and mortgage rates rise, it is unclear whether developers will be willing to pay big money for those sites.
The harbourfront Kai Tak Area 4C Site 3 can accommodate 648,617 square feet of gross floor area next to the cruise terminal, while Kai Tak Area 4B Site 2 can accommodate 594,095 square feet.
Led by the Urban Renewal Authority, the entire Kwun Tong regeneration scheme began in 2007 and is broken down into five development areas.
Sino Land and Chinese Estates Holdings are working on the Grand Central residential project, which is in the second and third development areas.
Grand Central comprises four apartment blocks, which will add 1,999 flats into the Kowloon East housing market upon completion.
Underneath the residential blocks is a large-scale shopping centre with 200,000 square feet of gross floor area.
Most mix two- and three-bedrooms flats geared to families, says Victor Tin, associate director (sales) at Sino Land, adding that there will be a small number of penthouse apartments with rooftops of around 1,500 square feet available for sale.
“New homes in established urban areas are fairly tight in supply,” he says.
“Meanwhile, as the Kwun Tong redevelopment continues, it will re-establish itself as a thriving community with excellent access to the two central business districts on Hong Kong Island and the CBD2 of Kowloon East.”