Vanke Property (Hong Kong) Co., a unit of China Vanke Co. (000002.CN), beat 17 other developers to win a residential site in Sham Shui Po in a Hong Kong government tender.
The site, located along Fuk Wing Street, was won with a bid of HK$1.31 billion, which was at the lower end of market estimates, the Hong Kong Economic Journal reported Thursday.
Vanke plans to invest a total of HK$3 billion to develop the site, the company’s assistant director for property development, Lesly Lam Lik-shan, was quoted as saying.
The land premium translates to HK$4,249 per square foot. Vanke is expected to sell completed units in the price range of HK$12,000 to HK$13,000 per square foot.
Charles Chan, managing director at Savills Valuation and Professional Services, said the land premium level is reasonable considering the present market conditions.
Vanke’s bid reflects Chinese developers’ ambitions to expand their business in Hong Kong.
According to Lands Department data, four out of nine land parcels that were successfully tendered out since July 2015 have gone into the hands of mainland-based developers.
In July last year, Vanke’s Hong Kong unit won a site on So Kwun Wat Road in Tuen Mun for HK$3.82 billion.
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