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Despite a lukewarm investment market, political and economic uncertainty, and an ongoing public aptitude crisis, the Hong Kong government is making progress with an attempt to sell a trophy off the boardwalk in the central shopping district before the end of this year, according to an announcement. Monday night.
The Hong Kong Department of Lands now plans to have the land, which runs from the central ferry docks inland to Jardine House, obtained by tender in the fourth quarter of this year as the site has yet to be announced. reserve value for auction. Some analysts estimate that the assets have possibly lost 25% of their cost since the beginning of this year.
The new port 3 central site remained on the government’s land sales list despite falling workplace rents to a minimum of 15 years in August, and the city’s only previous attempt to sell advertising land this year was canceled due to a lack of developer interest. .
“To be sure, the last few months have not been optimal for the terms of a sale of this magnitude and it may be herbal that the government needs to delay,” speculated Reed Hatcher, Cushman’s head of studies.
Site 3, covering approximately 4. 8 hectares (516322 square feet), was originally scheduled for sale until September 30, and the government announced in an announcement that the tender had been postponed to the fourth quarter because it took longer to complete a two-bid procedure. The two-stage sale of the project, which borders the City Council and will take over the existing Hong Kong General Post site, requires that offers be considered for their design merits as well as for their monetary value.
Knight Frank, head of valuation and advice, Thomas Lam estimates the price of the package between HONG Kong$37 billion and Hong Kong$40 billion (from $4. 8 billion to $5. 1 billion), or about 23 billion to Hong Kong$25,000, according to the square foot, in a forward-looking perspective. gross land domain of $1. 6 million. The total investment for the allocation can be between HK$60 billion and HK$65 billion.
The allotment is within walking distance of some of Hong Kong’s best-known advertising sites, adding the IFC, the Cheung Kong Center, the Plos angelesce de los angeles Bourse and the upcoming central market renovation.
Site 3 will feature up to 500,000 square feet of space, as well as commercial space, and the terms of the tender include height restrictions that are part of a set of design needs that “satisfy the public’s aspiration of quality open public spaces in the port,” according to an official statement.
The prospect of the plot unfolding in the kind of mixed-use cultural and advertising district that has helped riverside areas in Singapore, Sydney and other cities around the world become network centres has provoked public debate. “Your price goes much further the amount of money, ” said Eric Chong, Cushman’s associate director of studies
Contrary to its old practice of prioritizing land revenue over network considerations, the Department of Land attaches equivalent weight in the bidding procedure to the design and value elements of development bids.
Paul Zimmerman, Director of the Southern District of Hong Kong and Executive Director of Designing Hong Kong, who has more to pay a value and argues that Site 3 may be the anchor of a regionally rejuvenated and competitive central district.
“This has great potential and gains in the public domain. It connects the coastline at the point of the floor with the center increased,” Zimmerman said.
Dominance is a means of transit that can facilitate traffic in the middle, and “as a waterfront site, it will be parks and cafes for other people to enjoy,” Zimmerman added. “It will be a disgrace and a missed opportunity if we do not make it work, because there are no more places like this in Central. Site 3 is the last chance to put it all together».
While the center remains considered the crown jewel of Hong Kong’s classic shopping district, Central’s package market has undergone a radical transformation since Henderson Land paid H$23 billion for Murray Road car park in 2017, and since Knight Frank calculated the price of the hh50 billion in January this year.
According to the agency, the price of the plot has fallen by 25% since this pre-Covid assessment, as workplace rentals in Hong Kong have fallen for thirteen consecutive months. The only other land department offer this year: a planned sale of 19,788 square feet of land in Kai Tak – cancelled in May due to lack of interest from developers.
The vacuum rate in the workplace in the center 6% in August, the highest point since 2005, according to JLL. Rents in the neighborhood, which have long been the highest in the world, fell by 2. 5% last month compared to July.
Even optimists recognize that it will not bring to the city the kind of generosity it may have had in recent years.
“The traditionally higher vacuum point in Central, due to the economic downturn, has affected the point of trust of developers and investors,” said Hannah Jeong, head of valuation and consulting at Colliers International in Hong Kong. Jeong remained convinced that the developers would show interest in the site, noting that “site 3 is hot for a long-term game. “