Hong Kong developers looking to build on farmland, sites of old buildings as government reduces land available for private flats

By Sandy Li sandy.li@scmp.com / https://www.scmp.com/business/article/3026560/hong-kong-developers-looking-build-farmland-sites-old-buildings-government?utm_medium=partner&utm_campaign=contentexchange&utm_source=EdgeProp | September 11, 2019 11:57 AM SGT
Hong Kong's major developers are rushing to build more flats on farmland they already own and at urban sites where old buildings can be bought and torn down.
The push comes as the city government is slowing down the amount of land it is making available for developers to buy for private residential projects.
In June 2018, chief executive Carrie Lam Cheng Yuet-ngor announced that nine government sites " three in Kai Tak and six in Anderson Road Quarry " originally earmarked for private housing had been reallocated for the construction of 10,600 public flats.
Since then, developers have been looking for other options, said Vincent Cheung,managing director of Vincorn Consulting and Appraisal. It potentially could save the developers money as well, although they must get approval.
Sun Hung Kai Properties (SHKP) and Henderson Land Development are the two most active developers pursuing alternatives. The action comes as affordable housing has become a front-burner issue, as protesters have turned a spotlight on the problem among a list of their grievances.
With old buildings, the developers must get owners of individual units to agree to sell. But the weakening property market may entice some owners to sell to get cash in hand rather than wait and see whether prices go lower, he said.
"Developers will find it easier to acquire properties as more homeowners are concerned Hong Kong's political crisis may not be resolved in the short term," Cheung said. "More owners that have held their properties for decades will prefer to cash in as they worry the intensifying protests could take a further toll on the city's economy and trigger a deeper price correction."
Sun Hung Kai Properties applied to the Town Planning Board for permission to increase the number of flats it can build on farmland in Lam Tei in Tuen Mun district from 96 to 1,998 that would be 689 square feet on average.
"In recent policy addresses, the chief executive has stressed that the housing problem is the most critical of all livelihood issues," according to a document filed by SHKP.
"It (SHKP's proposal) will offer an...