Sham Shui Po redevelopment attracts 17 bids

Business | Winnie Lee 8 Apr 2020

The Urban Renewal Authority has received 17 bids for the Tonkin Street/Fuk Wing Street development project in Sham Shui Po.

Henderson Land Development (0012), Chevalier International (0025), Emperor International (0163), Wing Tai Properties (0369), Lai Sun Development (0488), Wheelock and Co (0020), Sino Land (0083), Far East Consortium International (0035) and K&K Property have all submitted tenders.

CHFT Advisory and Appraisal valued the project between HK$9,000 and HK$9,500 per square foot, while Midland Surveyors estimated the project to be worth nearly HK$1 billion.

This came after a non-industrial site in Mongkok was tendered out for only HK$3,658 per buildable sq ft last month, having received just five bids. The land plot at Reclamation Street and Shanghai Street was awarded for only HK$85.9 million, hitting a 16-year low for the district.

Amid a gloomy property market, Wing Tai Properties (0369) named its Tai Lam project at 166 Castle Peak Road Oma by the Sea, offering 517 units.

In secondary sales, a homeowner of a 912-sq-ft unit at Fleur Pavilia in North Point slashed the asking price by HK$1.5 million to HK$26.5 million for the foreclosure sale.

And a 517-sq-ft flat at Telford Garden was sold for HK$6.5 million or HK$12,500 per sq ft, HK$1 million lower than the initial asking price.

JLL said the nine-year-high unemployment rate in the city is putting pressure on local housing prices and it expects home prices to fall by 10-15 percent in 2020.

Bank of America expects primary property prices to drop 15 to 20 percent and secondary property prices to fall 10 to 15 percent this year.

However, Morningstar said with low interest rates in the medium term and confidence in the city's future remaining firm, the property market is unlikely to see a large-scale decline.

Meanwhile, in the commercial property market, Cushman & Wakefield expects office rents to fall by 13 to 18 percent this year as the overall availability rose to 10 percent in the first quarter, a 10-year high. It also forecasts 1,000 restaurants will shut down.

Bank of America also expects the rent of offices to decrease 10 to 20 percent and the rent for shops to drop 5 to 20 percent in 2020.

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