Henderson scoops prime Central harbor site for $50.8b

Henderson Land Development has spent HK$50.8 billion to secure site 3 of the New Central Harbourfront with a 50-year land grant following a two-envelope open tender.

The 516,300-square-foot site at Man Yiu Street sits right next to International Finance Centre, which was jointly developed by Henderson, and enjoys a good view of Victoria Harbour.

The sum looks to be the highest-ever selling price for a single site in Hong Kong. It had been valued at between HK$37 billion and HK$56.5 billion.

An official for the Development Bureau said the vision is for site 3 to become a new landmark in Hong Kong.

"The successful tenderer's proposal is based on the idea of a bridge and aims to curate a world-class iconic landmark in Hong Kong, enhance the connectivity between the hinterland and harborfront in Central and create a vast amount of green and public space."

It added: "The successful tenderer proposes to have three buildings with a view to accentuating Hong Kong's image as Asia's World City."

The block closest to the harbor will be multi-functional whereas the other two will be office buildings.

Adequate separation is proposed among the buildings as ventilation corridors and "city windows" to ensure the project will have sufficient natural ventilation and lighting.

The public open space proposed will exceed the minimum of 25,000 square meters as required in the tender document.

What is already known as Horizon Park - a platform at roof level - will connect the three buildings.

The public will be able to enjoy panoramic views of the Central cityscape and Victoria Harbour from there.

The platform, to be fashioned as an urban forest, will also provide a lawn, jogging routes and outdoor space for public use.

The proposal also provides a pedestrian network to link with existing routes in Central, connecting its hinterland areas with the harborfront. There will also be a pedestrian connection with Central MTR Station.

The administration adopted a two-envelope approach in the tender to take both design and premium into consideration, meaning an equal weighting for premium and non-premium proposals was adopted.

A tender assessment panel assessed the tender proposals in accordance with requirements, and Henderson Land's Pacific Gate Development attained the highest marks with its ideas.

The SAR administration had received six tenders. But four of them did not conform with a requirement that a tender must attain a passing mark for both the premium and non-premium proposals in the two-envelope approach.

In other words, two of the tenders - including Henderson's successful one - fulfilled both requirements. That led to one of the two being given a higher total mark and hence awarded the tender.

CK Asset, New World Development and a consortium formed by Sino Land, China Merchants Land and Great Eagle were also among the bidders.

Development Bureau officials will be releasing combined scores, the premium offer and the gist of the design proposals of the second conforming tender after the completion of transaction procedures.

Site 3's 516,300 square feet offer a gross floor area of 1.84 million sq ft and will be mainly used for commercial and retail purposes.

There will also be 228,000 sq ft for government, institutional or community facilities plus a car park.

Netting out areas for public use, the average price is HK$31,462 per sq ft in gross floor area.

This latest winning of a tender by Henderson Land marks its second major investment in Central in 4 years.

The developer submitted the winning tender for a commercial site on Murray Road with a HK$23.2 billion bid in May 2017. That was a record high for Hong Kong at that time.

Given the top gross floor area of around 465,000 square feet, the average price stood at around HK$50,063 - also a high that still stands in the SAR.

That came before Sun Hung Kai Properties purchased the giant commercial site atop the West Kowloon Station for HK$42.2 billion in November 2019, which set the record high before site 3.

The also came with an area of over 643,100 sq ft, or a gross floor area of 3.16 million sq ft.