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Property News Weekly Digest
2019/9/28
〈Asian Post, September 28, 2019〉Less than half of 218 of the most expensive flats ever offered at former airport are sold as project seen as a victim of trade tensions and civil unrest

The most expensive new flats ever to go on the market at Kai Tak, the site of Hong Kong's former airport, received a frosty reception yesterday as buyers held back amid a market reeling from months of civil unrest and the effects of the US-China trade war.

By 10pm, just 98 of the 218 flats on sale at Upper Riverbank had found owners, a disappointing show when compared to similar project launches.

The first residential project at Kai Tak to be launched in the last two years was "selling relatively slowly", said Sammy Po Siu-ming, chief executive of the residential division at Midland Realty.

The protracted trade stand-off between the world's two largest economies and the political crisis that had engulfed Hong Kong were "still troubling the housing market", he said.

Upper Riverbank is the first Hong Kong project by mainland developers Longfor Group and KWG Group.

Po said the strong sales seen in recent weeks at another new project, Cullinan West III, were down to the very low prices offered, which had "made potential buyers think they were bargains".

The flats on sale yesterday had an average price of HK$24,677 per square foot after discounts, the highest of any project launched there.

That was 25 per cent higher than the latest price of HK$18,530 per square foot in the secondary market for homes at The Latitude in nearby San Po Kong.

〈Asian Post, September 27, 2019〉The Hong Kong government caused a stir this week when it withdrew a sizeable plot of waterfront land from sale after rejecting five apparently low bids. But the canary in the property coal mine had been Goldin Financial Holdings, which walked away from the same project three months earlier.

The developer decided to forfeit its HK$25 million deposit when it gave up on the HK$11.1 billion plot at the former airport in Kai Tak, just two days after an estimated 1 million people took to the streets to oppose the government's doomed extradition bill.

Abraham Razack, Goldin's independent non-executive director and a pro-business lawmaker who was manhandled in the legislature when the bill was about to be scrutinised, blamed "social contradictions" - a euphemism for the then looming troubles over the legislation - and the impact of the trade war with Washington.

Putting on a tough front, the government doubled the bid deposit to HK$50 million to deter further snubs by developers. But on Wednesday it decided to withdraw the site after it found no buyers willing to cough up its reserve price, as market watchers warned of developers getting cold feet amid the continuing social unrest.

Once again, the impact of the protests on the golden goose of property in Hong Kong has become a talking point, with property tycoons coming under mounting pressure to do their part to defuse the tensions..

〈China Daily, September 27, 2019〉New World Compnay Ltd has announced that it will donate three million square feet of agricultural land to the government or non-profit organisations for the building of public homes.

The four biggest developers in Hong Kong hold more than one hundred million square feet (more than 1000 hectares) of agricultural land in their reserves altogether. Henderson Land Development Company Limited holds the largest portion at around 45%, followed by Sun Hung Kai Properties at around 30%, New World Development at around 16%, and CK Asset Holdings Limited at around 9%.

As the government is faced with obstacles when trying to find land to put up housing, there is widespread speculation that it intends to invoke the Lands Resumption Ordinance to speed up the process of recovering land from real estate developers for the building of public housing.

New World Development has claimed repeatedly that the donation has nothing to do with the proposed invocation of that ordinance, stressing the move is more than one year in the making. As early as the beginning of last year, the company signed a memorandum of cooperation with "Light Be", a social enterprise, for the building of social housing to be inhabited by families on low incomes. That said, the current social atmosphere means that the decision to donate land has inevitably given rise to many political conjectures.


〈The Standard, September 26, 2019〉The Lands Department has put up notices in Kwu Tung North and Fanling North, marking the start of the land resumption process for new developments.

The move is the first phase of development plans in the Northeast New Territories, including advance and first stage work in site formation for a new town development and building the Fanling bypass.

This comes after Secretary for Development Michael Wong Wai-lun was quoted as saying he supported resuming more land via the Lands Resumption Ordinance, according to the Democratic Alliance for the Betterment and Progress of Hong Kong.

The party also called on the government to seize private developers' land for public housing.Chief Executive Carrie Lam Cheng Yuet-ngor is expected to announce further details in her policy address next month.

The government said it will resume 784 private land plots amounting to about 68 hectares as well as nine land plots occupied by graves totaling 752.8 square meters in the first phase of development.

The plots will be resumed on December 27, three months after the government notices were put up.

The date is not the deadline for households and business owners to move out, the government added. That should be some time between the first half of next year to the second half of 2022.

〈Business Post, September 25, 2019〉Landlords in Tsim Sha Tsui, a major hub for retail stores and restaurants in the city, have seen rent cuts during the past two months as the ongoing anti-government protests take a larger toll on Hong Kong's tourism and retail businesses.

Shops on Cameron Road, a first-tier street for local consumers and tourists in the district, have had to close on weekends when mass protests occur, says Mark Tong, sales director of Midland IC&I. Customers sometimes cancel their reservations, worsening the business environment on the block.

Landlords in other parts of the district face a similar predicament. The large ground-floor shop A2, sized 6,331 square feet, at China Insurance Building, 48 Cameron Road, was rented out to local restaurant chain Yuen Long Bistro in August for HK$360,000, or HK$56.86 per sq ft per month, 36 percent less than for its former tenant.

The landlord of street shop B in the same building, which has a floor area of 400 sq ft, has renewed its contract with clothing store Initial Fashion for a rental price of HK$368,000, or HK$920 per sq ft per month, down from the previous price of HK$480,000 per month. In addition, the ground floor B, C shops of Kam Ma Building, 16 Cameron Road, totaling 1,600 sq ft, were rented by cosmetics store M26 for a rental price of HK$200,000, or HK$125 per sq ft per month. The new rent is 9 percent lower than that for the previous occupant, a restaurant.