Sun Hung Kai Properties has won a residential site in Sha Tin for HK$606 million through tender - in line with expectations. The amount translates to around HK$3,100 per buildable square foot.
SHKP plans to build medium- to small-sized homes on the site with an estimated total investment of approximately HK$2.3 billion, Lui said.
Market valuation for the plot ranges from HK$540 million to HK$680 million, or HK$2,800 to HK$3,500 per square foot.
The other five tenderers included K&K Property, CK Asset, China Overseas Land & Investment, Kerry Properties and Sino Land, according to the Lands Department.This is the second site that SHKP secured in Sha Tin in less than a year. It was awarded a plot in Siu Lek Yuen for HK$619 million, or nearly HK$4,000 per sq ft, last July.
The successful tender showed that small-scale premium sites are still attractive to developers amid a sluggish property market, said Alvin Lam Tsz-pun, director at Midland Surveyors.With a small development scale, the investment cost and risk are relatively low, Lam said, adding that it would be easy for the developer to sell homes built in the area given the limited new supply.
Last year, residential property prices dropped at a faster pace of 7.1 percent in their third consecutive year of decline amid high interest rates and an ample supply in the primary market.Authorities also slowed down the pace of land sales in a bid to stabilize the market, with only one small site in Tung Chung worth up to HK$800 million up for tender this quarter.
Secretary for Development Bernadette Linn Hon-ho said earlier that the government will adopt a cautious and pragmatic approach, adjusting land supply strategies flexibly based on market conditions to address both housing and economic needs.She projected that the land sale revenue for the fiscal year will exceed HK$4 billion, though unlikely to reach the original target of HK$33 billion.
aiden.he@singtaonewscorp.com
