Mainland firms and their consortiums snap up nearly 60% of government sites in the first half of 2019
Only two residential sites on the Kai Tak runway with sea view remain
HONG KONG, 27 June 2019 – Only two remaining residential sites to be tendered on the Kai Tak runway could enjoy Victoria Harbour views after the government awarded the tender for Kai Tak Area 4C Site 1 site. Developers remain keen in acquiring sites in Kai Tak because there are fewer land supply with a Victoria Harbour view, according to the latest Residential Sales Market Monitor Report released today.
According to information from the Town Planning Board, there are only two remaining residential sites to be tendered on the Kai Tak runway where future units could enjoy Victoria Harbour views. Yet, the views will be more obstructed as the sites are located further away from the tip of the runway.
Beyond Kai Tak, there will be an extremely limited supply of Victoria Harbour seafront residential developments completed in the city’s urban areas. Our data on future supply suggests fewer than five such residential projects will be completed between 2019 and 2020.
The winning bid for the latest Kai Tak site remains high, despite the escalation of tensions between the US and China and a bout of social unrest has dented market sentiment. Henry Mok, senior director of capital markets at JLL, said: “Most of the future units on the sites in Kai Tak’s former runway area can enjoy unobstructed sea views, is already being imagined by the market as a future high-end residential area within the city. It has attracted the interests from both Hong Kong and mainland developers. We expects developers will remain intact on the remaining two waterfront sites.”
Cathie Chung, senior director of research at JLL, said: “Also, 57% of the government residential sites up for tender in the first half of this year were sold to mainland developers and their consortiums. It is higher than the 43% recorded in the second half of 2018. It suggests mainland developers remain optimistic on the city’s housing market over the medium-to-long term. We believe another reason is because most of the sites up for tender are in Kai Tak, which is a familiar market to many mainland developers and in a prime location. This has led mainland developers to become more active this year.”
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