Tenders called for renovated building

Finance | 11 Feb 2016

Tung Fat Building, a former residential structure turned into a New York-style loft in Kennedy Town, was put up for public tender with an indication price of HK$350 million.

The tender, issued by the owner of the building, Victoria Allan, expires on February 26.

It said four to five parties are interested in acquiring the tong lau structure, which refers to spacious apartment buildings with high ceilings built in the 1950s that have no lift access.

Several of the parties, according to Allan, are experienced local property companies and mainland-based investors.

The building took more than 10 years to renovate, as the entire drainage system had to be changed and a lift was installed. Eight luxury apartments were put on the rental market upon completion in 2014. Most of the tenants are expats. The total salable area of the nine-story building is 11,067 square feet, thus the per sq ft price is indicated at HK$31,626.

Tung Fat Building's eight apartments are sized between 1,250 sq ft and 1,337 sq ft and all enjoy harbor views. Rents start at HK$88,000 per month.

"Even though the primary market is depressed, I would say the high-end market in Hong Kong is a different story," said Allan, who believes luxury flats are outperforming the mass market as they are able to ask for a 10 percent hike in rentals while renewing leases.

When asked if it was the right time to sell, Allan said she wanted to stabilize the building after renovation and therefore put it out for rentals in the past year. Development in the area is mature enough for the building to be put on sale. JLL is managing the sale. ESTHER YU

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