Date
15 December 2018
Some of the units at the T-Plus residential project in Hong Kong's Tuen Mun district measure just 128 square feet in size. Photo: HKEJ
Some of the units at the T-Plus residential project in Hong Kong's Tuen Mun district measure just 128 square feet in size. Photo: HKEJ

Softening property market a big test for tiny flats

The T-Plus residential project in Tuen Mun was launched on Wednesday with an average price of nearly HK$17,000 per square foot for the first batch of 73 apartments.

It’s a joint venture project between mainland developer Jiayuan International (2768.HK) and Hong Kong’s Stan Group.

T-Plus has attracted a lot of attention since most of the 365 apartments are the so-called nano flats. Some apartments have an area of just 128 square feet. And there are up to 29 flats on one floor.

The project was first revealed in November 2016, and it quickly stirred public outcry due to the super-tiny size of its flats.

The land plot that will house T-plus changed hands a couple of times since 2014, and the price has surged many times over the period.

Chun Wo and its partner won the site in 2014 for HK$230 million. That represents a floor price of merely HK$1,530 per square feet, the lowest in Tuen Mun for over 12 years.

The site was then sold to Stan Group for HK$1.2 billion in July last year.

Then in May this year, when the local property was still red-hot, Jiangsu-based Jiayuan International announced that it had acquired 70.1 percent stake of three assets from Stan Group, including the site of T-Plus.

While seller Chun Wo has bagged handsome gains, Jiayuan is now faced with a difficult market at the moment, especially when the tiny-flat market is expected to bear the brunt of this round of housing market correction.

The cost level of the project is estimated to be around HK$12,000 per square foot.

The offer price of HK$17,000 per square foot makes T-Plus the most expensive project in Tuen Mun district.

Even its sales agent seems to be not so optimistic about the market response.

As property prices kept surging over past 15 years, unit sizes at some new developments have become smaller and smaller, and T-Plus is an extreme case.

It remains to be seen if the project will mark a resounding end of the bull market.

This article appeared in the Hong Kong Economic Journal on Nov 29

Translation by Julie Zhu

[Chinese version 中文版]

– Contact us at [email protected]

RC

Hong Kong Economic Journal columnist

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