Mong Kok dips to 16-year low as site fetches meager $86m

Business | Stella Zhai 2 Apr 2020

A land plot in Mong Kok was awarded for only HK$85.9 million, or around HK$3,658 per square foot, hitting a 16-year low for the urban area.

The tender of the non-industrial site, Kowloon Inland Lot No. 11238 at Reclamation Street and Shanghai Street, was awarded to Eagle Legend Engineering Management Consulting Company, a subsidiary of Eagle Legend Asia (0936).

Market surveyors had valued the plot at between HK$120 million and HK$290 million, or HK$5,000-HK$12,000 per sq ft.

The plot has a total site area of 2,718 sq ft and a buildable area of 24,462 sq ft.

The average price was the lowest since local developer Chinachem Group won the bid for a plot in the district at around HK$2,961 per sq ft in 2005.

Thomas Lam Ho-ma, executive director of Knight Frank, said the price reflected developers' concerns about the downward economy after the coronavirus pandemic.

Meanwhile, more price cuts across the property market were recorded, with a 2,269-sq-ft office at 9 Queen's Road, Central, rented out for only HK$57.5 per square foot, a 6-year low for the skyscraper.

Japanese discount store Don Don Donki was said to have rented a 10,000-sq-ft shop in Central for a monthly rent of HK$1.2 million, nearly half the previous price. Also, the rent for a house at Regalia Bay in Stanley slumped by 25 percent from its peak six years ago to HK$98,000 per month.

In the secondary market, a homeowner suffered a loss of HK$6.5 million after holding onto a house in The Beverley Hills, Tai Po, for 12 years. About 70 percent of the deals in the project have changed hands at a loss in the market.

Elsewhere, the benchmark project Laguna City in Lam Tin recorded 18 secondary transactions in March, with a 687-sq-ft flat sold for HK$9.78 million, or HK$14,236 per sq ft, after 11 percent was cut from the initial asking price.

Luxury apartment rents in Hong Kong Island, Kowloon and the New Territories slumped by 6.1 percent, 7.4 percent and 4.5 percent, respectively over the first quarter of 2020, the worst performance for all three districts since 2010, data from property consultant Savills showed. Luxury rents have fallen by at least 10 percent since they began to turn down a year ago, it said.

In other news, the number of mortgage loans for completed home units dropped by 26.4 percent from a month ago to 5,394 in March, while the number of equitable mortgages rose 11.4 percent month-on-month to 886, according to data from mReferral Mortgage Brokerage Services and the Land Registry.

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