Weak response among property firms to Kai Tak residential plot a week after sale was cancelled due to Hong Kong protests

By Pearl Liu pearl.liu@scmp.com / https://www.scmp.com/business/article/3015587/weak-response-among-property-firms-kai-tak-residential-plot-week-after?utm_medium=partner&utm_campaign=contentexchange&utm_source=EdgeProp | June 24, 2019 10:00 AM SGT
A residential plot at Hong Kong's old airport received a lukewarm response from developers on Friday, with only about five bids submitted for the oceanfront piece of land by 7pm.
The sale of Area 4C Site 1 on the Kai Tak runway was postponed last week because of mass protests in Hong Kong. The plot could yield 714,374 sq ft of gross floor area for an estimated HK$20,000 (US$2,560) per square foot, and is expected to set a price record.
"It is a really bad reaction for a plot at such a prime location, showing that developers are pessimistic about the market," said James Cheung, a surveyor at Centaline Surveyors.
Surveyors expected at least six submissions for the site. The Area 4C site 2 next to it, for instance, received seven bids on May 7. The site 2 plot sold for HK$12.6 billion, or HK$19,636 per square foot, the current highest price at Kai Tak.
"It may be hard to beat that price [of site 2] considering the softened appetite. Even the developers still going for the site will be more cautious, and probably give a rather modest price," said Cheung.
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A joint-venture of K Wah International Development and Sino Land, as well as Sun Hung Kai Properties, Hong Kong's largest developer, were among companies that have submitted bids for the plot of land.
The tender, originally scheduled for last Friday, closed at 5pm after government officers were shut down during the day by another protest on Friday.
Sentiment has been furthered dampened by the ongoing US-China trade war, after US President Donald Trump threatened to increase tariffs on US$200 billion dollars worth of Chinese goods from 10 per cent to 25 per cent on May 10.