Kowloon project draws 31 expressions of interest

The Urban Renewal Authority received 31 expressions of interest from developers, as the submission deadline for the Kai Tak Road/Sa Po Road development project in Kowloon City ended yesterday, but surveyors have cut their estimated price for the site.

The interested developers include Emperor International (0163), China Overseas Land and Investment (0688), Wheelock Properties, CSI Properties (0497), Chinachem and Regal Hotels.

The land site encompasses 57,125 square feet, with a maximum allowable gross floor area of 514,121 sq ft, and it is estimated that about 810 residential homes can be built on the site.

CHFT Advisory and Appraisal's senior director Alex Leung Pui-wang has lowered the consultancy's valuation of the site by 10 percent, to between HK$2.6 billion and HK$2.8 billion, with a per square foot estimate of about HK$5,000 to HK$5,500. The adjustment is primarily due to lower bid prices for land in the vicinity.

He also noted that factors like interest rate hikes, cost implications, and the market's anticipation of declining property prices are all causing developers to bid cautiously.

In the primary market, Sun Hung Kai Properties's (0016) University Hill in Tai Po released its sixth price list yesterday, providing 65 flats with an average discounted price of around HK$16,127 per sq ft, which is similar to the previous batch.

In Aberdeen, Emperor International's SouthSky project has unveiled two unfurnished units for public viewing.

The first price list is expected to be released shortly and sales of at least 50 flats are expected to start by the end of the month.

Out of the 10 major housing estates, seven have seen a decrease in home prices compared to the end of last year, with City One Shatin experiencing a significant drop of 13.5 percent per sq ft.

The recent price in City One Shatin is about HK$12,479 per sq ft, close to mid-2016 prices. At Kingswood Villas, it is around HK$8,459 per sq ft, back to early 2017 price levels.

UBS expects home prices in Hong Kong to decline by more than 10 percent next year due to the high debt risks faced by small and medium-sized developers and the anticipation of continued elevated interest rates.

JLL anticipates a maximum 5 percent decrease in luxury residential prices this year, with another 5 percent decline expected in 2024.