Chinese developers snap up discounted Kai Tak land as Hong Kong's mood for property sours amid protest rallies and trade war

By Pearl Liu / | July 2, 2019 11:51 AM SGT
Two mainland Chinese developers bought a plot of residential land on the runway of Hong Kong's former Kai Tak airport, paying a lower-than-expected price for the oceanfront property as the city's biggest public protests in decades sapped appetite for investments amid a US-China trade war.
China Resources Land and Poly Property Group, two real estate units that belong to two of China's largest state conglomerates, won a tender for the second-biggest parcel of land that is earmarked for building homes, paying HK$12.9 billion (US$1.65 billion) for Kai Tak Area 4C Site 1, according to an announcement by the Lands Department.
The price, equivalent to HK$18,080 per square foot, was lower than the HK$14 billion expected by valuers, and about 8 per cent cheaper than the adjacent Area 4C Site 2 parcel that sold on May 7.
"Sentiments have changed recently, and developers tend to be a little cautious," said James Cheung, a surveyor at Centaline Surveyors in Hong Kong, who had cut his valuation of the parcel by 10 per cent to HK$18,000 per sq ft before the tender result was announced.
In land-scarce Hong Kong, bids for available plots are often the weather vane for the property market's direction, with Kai Tak " offering full views of Victoria Harbour and earmarked as the next central business district " at the epicentre of the trend.
Sentiments had been topsy-turvy in Hong Kong's property sector since mid May, when US President Donald Trump upped the ante on his year-long trade war with China, slapping a 25 per cent tariff on US$200 billion of Chinese imports. He is scheduled to meet Chinese President Xi Jinping in Osaka this week after their meeting at the Group of 20 economies to resolve the dispute.
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The mood in Hong Kong had also been downbeat since...