Best Fortune - New Roundup http://www.bestfortune.com.hk/news_detail2.php Best Fortune - New Roundup http://www.bestfortune.com.hk/image/rss.jpg http://www.bestfortune.com.hk/news_detail2.php 2016-11-04 <![CDATA[Hong Kong more than doubles property stamp duty to 15 per cent to cool overheating market]]> <font face='Arial, Helvetica, sans-serif'><p class="v2-processed" style="box-sizing: border-box; margin: 0px; max-width: 100%; color: rgb(51, 51, 51); font-family: &quot;PT Sans&quot;, sans-serif; font-size: 18px;">Hong Kong’s government has announced the latest round of property measures to cool off property investments by increasing the stamp duty on property transactions to 15 per cent across the board.</p><p class="v2-processed" style="box-sizing: border-box; margin: 16px 0px 0px; max-width: 100%; color: rgb(51, 51, 51); font-family: &quot;PT Sans&quot;, sans-serif; font-size: 18px;">It will be raised from the previous range of between 4.25 per cent and 8.5 per cent.</p><p class="v2-processed" style="box-sizing: border-box; margin: 16px 0px 0px; max-width: 100%; color: rgb(51, 51, 51); font-family: &quot;PT Sans&quot;, sans-serif; font-size: 18px;">The measures apply to individual and corporate buyers effective on November 5.</p><p class="v2-processed" style="box-sizing: border-box; margin: 16px 0px 0px; max-width: 100%; color: rgb(51, 51, 51); font-family: &quot;PT Sans&quot;, sans-serif; font-size: 18px;">Chief Executive Leung Chun-ying said the new round of measures are being implemented because home prices have risen at a faster pace with increasing investors rushing into the market.</p><p class="v2-processed" style="box-sizing: border-box; margin: 16px 0px 0px; max-width: 100%; color: rgb(51, 51, 51); font-family: &quot;PT Sans&quot;, sans-serif; font-size: 18px;">Hong Kong’s home prices rose for the sixth consecutive month in September, bringing an accumulative growth of 8.9 per cent, led by small and medium sized homes, according to government data.</p><p class="v2-processed" style="box-sizing: border-box; margin: 16px 0px 0px; max-width: 100%; color: rgb(51, 51, 51); font-family: &quot;PT Sans&quot;, sans-serif; font-size: 18px;">Home prices in September were just 3.46 per cent below the peaks in September last year, according to the Rating &amp; Valuation Department.</p><p class="v2-processed" style="box-sizing: border-box; margin: 16px 0px 0px; max-width: 100%; color: rgb(51, 51, 51); font-family: &quot;PT Sans&quot;, sans-serif; font-size: 18px;">In April , home prices rose 0.6 per cent month-on-month, but the growth rose at a faster pace. In September, the month-on-month increase reached 2.78 per cent.</p><p class="v2-processed" style="box-sizing: border-box; margin: 16px 0px 0px; max-width: 100%; color: rgb(51, 51, 51); font-family: &quot;PT Sans&quot;, sans-serif; font-size: 18px;">from South China Morning Post</p> </font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=1461 2015-11-05 <![CDATA[Hong Kong property sales slump to 19-month low for October - and worse is yet to come, say analysts]]> <font face='Arial, Helvetica, sans-serif'> <p><font size="4">(South China Morning Post)</font>Property sales in Hong Kong slumped to a 19-month low in October, and analysts predict the worst is yet to come. The government, meanwhile, said it would continue to increase land supply.</p><p>The slump in total sales volume accelerated last month, with sales down 43.63 per cent year on year, compared with September's drop of 31.6 per cent.</p><p>"It is the worst October result since we started recording data in 1991," said Buggle Lau, chief analyst at agent Midland Realty.Overall transactions in October fell 17.85 per cent from the previous month to 4,491, following a modest recovery in September, the Land Registry said. In September, total property transactions rose 5.2 per cent month on month to 5,467.</p><p>Chief Executive Leung Chun-ying yesterday said he would continue to increase land supply for residential flats and maintain restrictive measures on overseas buyers.</p><p>Speaking before an Executive Council meeting, Leung said government efforts to increase land supply had started to bear fruit, with an 11-year high supply of new private flats expected for the coming three to four years.</p><p>The Transport and Housing Bureau said that new flats to be completed up to 2019 would amount to 86,000. This was a record high from September 2004 when the bureau began releasing related figures, Leung said.</p><p>"We have put more land into the market through changing land use ... our efforts have started to have an effect," he said.</p><p>Last month residential transactions fell 22.6 per cent to 3,300, from September's 4,263, as the take-up rate in primary launches weakened while sales activity in the secondary market was painfully quiet. The total sales value of residential deals fell 32.81 per cent month on month to HK$22.52 billion.</p><p>"There were 2,035 transactions recorded in the secondary market," said Derek Chan, head of research at agent Ricacorp Properties. "The situation was even worse than … when Hong Kong was hit by the severe acute respiratory syndrome [Sars] outbreak in 2003."</p><p>Chan said monthly transactions in the secondary market averaged 3,478 in 2003, with the lowest number - 2,505 deals - seen in February of that year. He expected the market would be clouded by cautious sentiment, with total sales volume likely to hit the 3,800 level when the Land Registry announces the November figure.</p><p>As there is usually a lag between a transaction and its registration, the October figures reflect the market in September to early October.</p><p>Lau said sales of new homes dropped 12 per cent month on month in October to 1,409 units, down from September's 1,602.</p><p>An increasing number of analysts are predicting Hong Kong home prices will start to fall next year, with some expecting a decline of 30 per cent by 2017 as interest rates rise, supply increases and the economy deteriorates.</p><p>According to investment bank Barclays, home prices are now down 2.7 per cent compared to their mid-September peak.</p><p>"Should home prices continue to fall in the coming weeks, this could tip the home owners' and home buyers' sentiment mindset into bearish territory and potentially speed up the pace of the physical market's correction," it said in its latest research report.</p> </font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=1209 2015-09-16 <![CDATA[Hong Kong home sale volumes in secondary and primary markets moving in opposite directions]]> <font face='Arial, Helvetica, sans-serif'> <p><font size="4">(South China Morning Post)Home sales in the secondary and primary residential market in Hong Kong are moving in opposite directions in terms of transaction volumes and more secondary owners are expected to slash asking prices, say industry experts.</font></p><p><font size="4">Agents say an "Ice Age" has descended on the secondary residential market while developers - who continue to offer an array of incentives to lure buyers - are enjoying encouraging sales.</font></p><p><font size="4">"The number of weekly transactions in major housing estates has dived below 50 for six consecutive weeks. It is the longest dip in the past 20 years," said Buggle Lau Kar-fai, chief analyst at Midland Realty.</font></p><p><font size="4">During the week to Sunday, 34 units were sold at 35 estates tracked by Midland Realty, down 10.5 per cent from the 38 sold in the previous week.</font></p><p><font size="4">He said there was only one week which was just as poor - in 2003 when the city was gripped by the outbreak of severe acute respiratory syndrome.&nbsp;</font></p><p><font size="4">Zero transactions were recorded at 18 out of 35 housing estates it monitored.</font></p><p><font size="4">To speed up transactions, some owners in financial trouble have been forced to sell their homes at a loss or reduce their asking prices substantially.</font></p><p><font size="4">A 2,251&nbsp;square&nbsp;foot unit at a luxury development, The Graces, in Tai Po changed hands for HK$39 million, compared HK$44.89 million paid by the owner in 2013. Taking into account the 10 per cent special stamp duty if speculators flip homes within three years, the owner will lose nearly HK$10 million - the biggest loss since the stock market crash in July.</font></p><p><font size="4">In contrast to the sluggish secondary market, home sales in the primary residential market have remained strong.</font></p><p><font size="4">There were 370 units sold over the weekend of September 12-13, 6 per cent higher than the 349 units sold the previous weekend.</font></p><p><font size="4">Sun Hung Kai Properties sold all of the second batch of 338 units at the second phase of Century Link in Tung Chung. The developer has sold about 71 per cent of the 932 units at Century Link II over the past two weeks.</font></p><p><font size="4">"Recent sales of new launches and declining secondary volume suggest buyers are becoming more selective in primary launches and sale progress for primary launches with aggressive pricing will be affected," said Patrick Wong, a property analyst at BNP Paribas Securities (Asia).</font></p> </font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=1169 2015-04-27 <![CDATA[Projected Hong Kong private home supply raised to record 78,000]]> <font face='Arial, Helvetica, sans-serif'> <font size="4">(South China Morning Post)The projected supply of private homes in Hong Kong has been raised to a record high of 78,000 for the coming three to four years as the government accelerates land sales.<p>Analysts said an increased annual supply had become a trend, but one that was unlikely to stem rising home prices in the short term.</p><p>The Transport and Housing Bureau announced the official figures in a report on new private housing supply for the first quarter of the year.</p><p>Some 78,000 new homes are projected to be put on the market over the next three to four years, an increase of 4,000 flats from the estimate made in the bureau's previous quarterly report.</p><p>Meanwhile, the number of flats under construction in the first quarter of the year fell 75 per cent to 2,000 from the 8,000 reported in the first quarter of last year. The number of flat completions fell to 200, from 2,900 flats in the same period last year.</p><p>Property consultants put the declines in first-quarter flats under construction and flat completions down to differences in developers' construction schedules. They say supply will increase significantly in the second half of the year because the government has been increasing land supply.</p><p>"The number of 78,000 flats is a record-high projection, driven by an increase in land sales by the government in the first quarter," said Cliff Tse, national director of valuation advisory services at property consultant JLL.</p><p>The bureau's latest report says "units from disposed sites where construction may start any time" increased to 21,000 in the first quarter, an increase of 6,000 units from December.</p><p>The projection of 78,000 homes includes 61,000 units under construction but excludes those presold by developers.</p><p>In the first quarter of this year, developers presold 10,000 flats, up from 7,000 in the previous quarter.</p><p>Tse said the revised home supply projection would not result in an immediate correction in home prices.</p><p>The total of 78,000 units represented supply of between 19,500 and 26,000 flats a year, Tse said, which is comparable with the average home supply of 25,000 units a year in the 1990s.</p><p>Thomas Lam, the head of valuation and consultancy at Knight Frank, said the news would not affect home prices.</p><p>"In the short term, home seekers won't feel the threat as the increased supply has not yet come," he said.</p><p>But Wong Leung-sing, an associate director of research at Centaline Property Agency, said the market would gradually see a balance between demand and supply.</p><p>"The city's housing market has entered a new trend," Wong said. "Home supply will be sustainably increased to meet demand and developers will accelerate property launches to reap cash for new site acquisitions."</p><p>Centaline estimates that 17,703 flats will be completed next year, with 28 per cent of them already presold by developers.</p><p>The latest Centa-City leading index, issued yesterday by Centaline and which monitors home prices in the secondary market, dropped 1.1 per cent week on week to 140.04, slightly below the market peak of 142.36 recorded in the week to April 5.</p></font></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=1055 2014-10-30 <![CDATA[Government measures dim Hong Kong’s property investment appeal]]> <font face='Arial, Helvetica, sans-serif'> <p><font size="4">(South China Morning Post)Weak demand and the government's double stamp duty are keeping real estate investors away from Hong Kong's office market, say industry executives, while Japan and Australia have become favoured alternatives in Asia-Pacific.</font></p><p><font size="4">The preferred country-sector combinations are Japan-office, Australia-office and China-retail, according to this year's investment intention survey by the Asian Association for Investors in Non-Listed Real Estate Vehicles.</font></p><p><font size="4">Tight supply in the absence of strong demand growth would keep Hong Kong's office market flat or even push it slightly downwards, said the association's chairman Nicholas Loup, who helped Britain's privately owned property group Grosvenor set up its first Asia office in Hong Kong two decades ago.</font></p><p><font size="4">"Combine that with the [double] stamp duty measure [and] I would imagine investors to an extent would sit on the sidelines waiting to see some proper direction in the market and whether the government is going to relax these measures at some point," he said last week.</font></p><p><font size="4">"The fact that there has been some interference in the market for the first time in this way is sending a signal that maybe the game has changed in Hong Kong, where we used to have a very free and open market without government interference."</font></p><p><font size="4">In contrast, Australia has always been regarded as a transparent and liquid market with easy access, while investors are also looking at Japan as Abenomics boosts growth and investor memories about the 2011 Fukushima nuclear disaster fade.</font></p><p><font size="4">"What is interesting [about] real estate in markets such as Australia and Japan is the yield premium that one can achieve above the cost of funding," said Graham Mackie, chairman of the association's investor advisory board, who also serves as head of Asia-Pacific real estate at UBS Global Asset Management.</font></p><p><font size="4">The funding cost in Japan was 1 per cent while the cap rate was 4 per cent, he said.</font></p><p><font size="4">The UBS fund was also looking for opportunities in mainland China's logistics property sector, as well as refurbishment of Grade-B offices in Hong Kong and Singapore, Mackie added.</font></p><p><font size="4">Real estate investment in Hong Kong generated an average yield of 4 per cent, while Australia offered 6 to 7 per cent, said Simon Mallinson, executive managing director of EMEA at Real Capital Analytics.</font></p><p><font size="4">In mainland China, Loup said there were expectations of a market correction in certain cities and sectors.</font></p><p><font size="4">"So we'll certainly see some shake-up in the market there," he said. "With some high-profile issues at companies and the whole process of smoothing out the debt cycle in China, inevitably there will be some opportunities and better prices coming out in the next 12 months."</font></p> </font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=924 2014-07-31 <![CDATA[Hong Kong to see surge in tiny flats as demand remains strong]]> <font face='Arial, Helvetica, sans-serif'> <p><font size="4">(South China Morning Post)Developers are expected to produce more tiny flats in their future projects given the frenetic buying spree for shoe-box homes by young homebuyers and investors, industry observers said.</font></p><p><font size="4">Demand for cheaper small flats would continue to rise, they said, since Hong Kong home prices have remained buoyant despite the government's introduction of new stamp duties.</font></p><p><font size="4">"Building more small flats will become a trend, as they are sought after by younger home seekers and long-term investors," said Patrick Chow Moon-kit, head of research at Ricacorp Properties.</font></p><p><font size="4">A Midland Realty survey showed that land that had been sold in the past two years and designated for building small flats would supply 12,400 units over the next few years.</font></p><p><font size="4">Upcoming new home sales include those at Sun Hung Kai Properties' 968-unit The Wings Phase 3 in Tseung Kwan O, which will offer about 200 small units of 334 sq ft to 360 sq ft. The official launch date has not yet been set.</font></p><p><font size="4">Chow said that the market's attention has turned to smaller flats. He noted they were being sold for record prices in the secondary market and were commanding high rents per square foot.</font></p><p><font size="4">A case in point was a 225 sq ft unit at a new project, The Avery in Kowloon City, which has been leased at a monthly rent of HK$14,000, or HK$62 per square foot - which is higher than in Mid-Levels.</font></p><p><font size="4">On Monday, a 327 sq ft two-bedroom unit at City One in Sha Tin was sold for HK$4 million, or HK$12,400 per square foot. It was a record price per square foot for the development.</font></p><p><font size="4">Chow also attributed the popularity of small flats to the tightening of mortgage lending.</font></p><p><font size="4">Under Hong Kong Mortgage Corporation's mortgage insurance scheme, buyers of flats below HK$4.5 million could receive mortgage loans of up to 90 per cent of the flat's value, capped at HK$3.6 million, while for flats priced between HK$4.5 million and HK$6 million the maximum loan-to-value ratio is 80 per cent, capped at HK$4.8 million. For flats priced between HK$7 million and HK$10 million, the maximum ratio is 60 per cent, capped at HK$5 million.</font></p><p><font size="4">Since the government doubled the stamp duty for the purchase of a second or subsequent home, buyers of such flats have to pay stamp duty of 1.5 per cent, as against HK$100 previously, for a property priced at HK$2 million or below; 3 per cent, from 1.5 per cent previously, for one priced between HK$2 million and HK$3 million; and 6 per cent, from 3 per cent previously, for a unit priced at between HK$4 million and HK$6 million.</font></p><p><font size="4">"New homes being offered in the price range of HK$4 million and HK$6 million registered the fastest sales response because of the lending policy. Properties exceeding HK$7 million will require a higher down payment," Sino Land associate director Victor Tin Sio-un said.</font></p><p><font size="4">Sino Land has sold 95 units at Park Ivy - a joint venture with the Urban Redevelopment Authority in Tai Kok Tsui - sized between 256 sq ft and 321 sq ft.</font></p><p><font size="4">Midland said the number of secondary residential market transactions for homes worth HK$5 million or below fell to 3,479 last month after hitting a first-half high of 3,524 in May.</font></p> </font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=849 2014-03-10 <![CDATA[Dark clouds over Hong Kong's property market as 'perfect storm' looms]]> <font face='Arial, Helvetica, sans-serif'> <p><font size="4">(South China Morning Post)Hong Kong's housing market faces being caught in the middle of a perfect storm, with government curbs having crimped demand at a time of increasing supply and an imminent interest rate rise threatening to set off a severe price correction.</font></p><p><font size="4">Home prices in the second-hand market peaked at 18 per cent above the previous 1997 high in March last year after doubling since 2008, but have since fallen 5 per cent in a sign the government's tough stance on reining in an overheated market is having the effect desired by Chief Executive Leung Chun-ying.</font></p><p><font size="4">A collapse in demand that saw overall property sales plunge to a 23-year low of 70,501 deals last year has fuelled fears of a repetition of major downward trends of the past.</font></p><p><font size="4">Amid the continuing slide, which began when the government imposed a hefty increase in stamp duty in February last year, gloom-and-doom forecasts of prices plunging as much as 35 per cent in two years have emerged.</font></p><p><font size="4">"There are strong similarities with the 1997 bubble, but the exceptionally low level of interest rates has encouraged homebuyers to borrow more in this cycle than in 1997. So the market is far more dependent on inter-generational transfer of equity, low supply and low interest rates," said Andrew Lawrence, the managing director of real estate equities research at Malaysian investment bank CIMB Securities.</font></p><p><font size="4">Before 2009, about 75 per cent of property transactions required a mortgage, Lawrence said, but following a drop in mortgage rates, now at a historical low of about 2.2 per cent, nearly every property transaction had been mortgage-funded.</font></p><p><font size="4">One of the most bearish property analysts in the city, Lawrence said home values could fall more than 50 per cent in a worst-case scenario if the government did not relax the higher stamp duties.</font></p><p><font size="4">"The first stage is a function of the cumulative impact of government measures: dampening demand and increasing supply," he said. "The second stage is the result of a rise in interest rates due to the normalisation of United States monetary policy.</font></p><p><font size="4">"The return of property prices to their long-term trend would likely require both of these factors to weigh on prices, but a correction to long-term trend currently implies a 54 per cent correction. However, we are not expecting an immediate crash."</font></p><p><font size="4">Lawrence said a 35 per cent correction over the next two years was more likely, with most of that driven by increased supply.</font></p><p><font size="4">Leung has pledged to supply 20,000 new flats a year - just 14,100 started construction last year - as part of a plan to tackle soaring housing inflation that has pushed home ownership ever further out of the reach of ordinary people, fuelling social discontent.</font></p><p><font size="4">Lawrence said he expected interest rates and the exit of liquidity from the banking system would start to weigh on market sentiment in the months ahead.</font></p><p><font size="4">"In addition, given the change in the duration of the special stamp duty, we expect the second half of this year and the first half of next year to be hit by even lower demand levels," he said.</font></p><p><font size="4">The special stamp duty imposes a levy of up to 20 per cent on those who resell their flats within three years, compared with the previous 15 per cent levy on sales within two years.</font></p><p><font size="4">Forecasts by developers, whose revenues ride on property prices, are more positive.</font></p><div class="blockquote-quote"><font size="4"> This is the first time the market is undergoing consolidation because of austerity measures</font></div><div class="blockquote-author"><font size="4"> Joseph Tsang, Jones Lang LaSalle</font></div><p><font size="4">"It will only fall 5 to 10 per cent," said Stewart Leung Chi-kin, the chairman of Wheelock Properties, a subsidiary of Wheelock and Co.</font></p><p><font size="4">"How can home prices fall, taking into account rising construction costs? Developers will not sell homes at below cost as they have strong staying power.</font></p><p><font size="4">"They can sit on their projects and wait for the market's recovery. Developers can compensate for their shortfall in property sales through selling other assets and rental income."</font></p><p><font size="4">Leung's view was echoed by Li Ka-shing, the head of Cheung Kong (Holdings), the city's biggest developer by market capitalisation. Li said developers which had gone through the 1997 crisis were now "financial healthy with low gearing", implying they would be in no rush to sell properties at below cost.</font></p><p><font size="4">Despite the upbeat talk, there has been evidence of a downward trend, with a number of developers selling new homes at prices below those in the secondary market.</font></p><p><font size="4">In one example, Sun Hung Kai Properties last month sold flats at its Riva development in Yuen Long at HK$7,600 to HK$12,400 per square foot (on a net basis) - up to 45 per cent below list prices when the project was first launched in March last year and also 15 per cent below second-hand home prices in the area.</font></p><p><font size="4">Analysts expect developers will continue to cut prices when they launch new projects.</font></p><p><font size="4">But while they expect new supply and higher borrowing costs will exert pressure on prices, they rule out a return to the dark days of 1997, when prices plunged by as much as 70 per cent when a sharp rise in interest rates sowed panic among distressed homeowners with extremely high leverage levels.</font></p><p><font size="4">CLSA's regional head of property research, Nicole Wong, said a repeat of that crisis was unlikely.</font></p><p><font size="4">"The current price correction is policy-driven," Wong said. "Whenever there is a policy-driven correction, there is likely a floor because measures can be tweaked or even reversed if the correction goes too far."</font></p><p><font size="4">But the collapse in 1997 had no floor because it was driven by economic contraction, which created a downward spiral.</font></p><p><font size="4">Joseph Tsang, the managing director and head of capital markets at Jones Lang LaSalle, shared Wong's view, saying the average loan-value ratio was 70 per cent in 1997, compared with 50 per cent now, and there had been a regional economic meltdown at the same time.</font></p><p><font size="4">"This is the first time in history the property market is undergoing consolidation because of austerity measures," Tsang said.</font></p><p><font size="4">Paul Louie, the head of regional property research at Barclays, said in a report he believed the government would roll back the various stamp duties and other cooling measures if home prices fell 15 to 20 per cent.</font></p><p><font size="4">"But will this help support the market and stabilise home prices? The experience from the 1998 Asian crisis and the recent tightening clearly show that the various tightening or easing measures only have a fleeting impact, and it took a long time to reverse the overall trend," Louie said.</font></p><p><font size="4">In the 1997-98 crisis, the government rolled back restrictive measures within nine months, with home prices finding a temporary bottom in October 1998 and then rebounding 9.4 per cent by December, before dropping 25 per cent from 1999 to 2000.</font></p><p><font size="4">The first of the latest round of austerity measures were announced in 2009, but it took four years for their effects to be felt.</font></p><p><font size="4">"Our concern is that if the various property measures have not worked on the way up, why would they work in reverse to support home prices as they come down?" Louie said.</font></p> </font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=743 2014-01-23 <![CDATA[Hong Kong ranks world's No 1 for 'most unaffordable' housing]]> <font face='Arial, Helvetica, sans-serif'><FONT size=4>(South China Morning Post)Soaring property prices in the past few years have given Hong Kong the title of most unaffordable housing in the world for the fourth straight year, according to a survey of 360 cities by US-based consultancy Demographia.</FONT> <P><FONT size=4>The survey reported that Hong Kong's median home price was more than HK$4.02 million, while the annual median household income of HK$270,000 was nearly one-15th of the home price.</FONT></P> <P><FONT size=4>Demographia rated housing affordability in Hong Kong as "severely unaffordable".</FONT></P> <P><FONT size=4>"It is impossible for the salary income to catch up," said Polytechnic University real estate professor Eddie Hui Chi-man.</FONT></P> <P><FONT size=4>He said property prices had surged sharply while the government "didn't increase the land supply" and only resumed the Home Ownership Scheme for flats in October 2011, after it was suspended for nine years.</FONT></P> <P><FONT size=4>In 2012, property prices jumped more than 20 per cent.</FONT></P> <P><FONT size=4>Hui believes the housing problem will remain serious over the next two years as new housing supply will not increase significantly until 2016.</FONT></P> <P><FONT size=4>"Despite the government cooling measures in the property market, property prices would only drop a few per cent this year," he said. "The prices are still out of the budget of ordinary families."</FONT></P> <P><FONT size=4>Sammy Po Siu-ming, the chief executive of the residential department at Midland Realty, said he did not think property prices would drop sharply this year.</FONT></P> <P><FONT size=4>"The housing demand from end-users remains strong, while the interest rates are low. And many people are cash-rich," Po said, adding he expected that property prices would fall 5 to 10 per cent this year.</FONT></P> <P><FONT size=4>Canada's Vancouver and the United States' Honolulu ranked second and third in having the most unaffordable housing in the survey.</FONT></P> <P><FONT size=4>Demographia said if housing exceeded three times annual household incomes, it meant there were serious political issues that needed to be addressed, with respect to land supply and infrastructure planning, provisioning and financing.</FONT></P> <P><FONT size=4>In other Asian countries, the survey showed that Singapore's median home price was 5.1 times above the gross annual median household income.</FONT></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=713 2014-01-08 <![CDATA[Kerry Properties maintains prices amid heavy discounting]]> <font face='Arial, Helvetica, sans-serif'><P><FONT size=4>(<EM>South China Morning Post)</EM>Developer Kerry Properties has chosen not to follow the market trend of heavily discounting the prices of flats in its project The Summa, which will be released for sale this week.</FONT></P> <P><FONT size=4>In sharp contrast to steeply discounted launch prices announced last week by rival Cheung Kong (Holdings) at its Diva project in Tin Hau, Kerry has priced its units in The Summa in Sai Ying Pun at the same level as previously released new projects in the vicinity, and above secondary market prices for the area.</FONT></P> <P><FONT size=4>Cheung Kong grabbed the market's attention last week with the launch of units in The Diva, a single-block building at 133 Electric Road in Tin Hau, near Causeway Bay Market, at average asking prices of HK$22,514 per sq ft for the 118 flats, which range in size from 493 to 741 square feet. That is 16 per cent below the average price per square foot of saleable area of HK$26,779 achieved in November by Henderson Land for its nearby project The Hemispheres.</FONT></P> <P><FONT size=4>Buyers at The Diva who qualify for the maximum discount on offer when the flats are sold from Friday this week will enjoy a discount of 25 per cent on The Hemispheres' prices if they buy their flat by Tuesday and for cash, and join the project's Club Lifestyle. The minimum price of a 493 sq ft flat in the project works out at HK$7.97 million after discounts.</FONT></P> <P><A class="colorbox colorbox-insert-image init-colorbox-processed-processed cboxElement" title="The Diva in Tin Hau undercuts a rival project. Photo: Edward Wong" href="https://www.scmp.com/sites/default/files/2014/01/07/09a44890711c4064ca77b2adc3592d12.jpg" rel=gallery-all jQuery1389145490209="10"><FONT size=4></FONT></A></P> <P><FONT size=4>Kerry Properties' The Summa in Sai Ying Pun will also be launched for sale this week. The development in Hing Hong Road, near King's College, comprises 168 flats, and according to the price list released on Friday last week the average price per square foot of saleable area of the first batch of 50 flats works out at HK$27,202.</FONT></P> <P><FONT size=4>The saleable area of the flats is between 756 and 1,513 sq ft, and prices will range between HK$17.92 million and HK$49.9 million. The average price after discounts is HK$22,989 per sq ft - higher than secondary market prices in the district, which range between HK$13,000 and HK$18,000 per sq ft. But the prices are similar to those achieved by Sun Hung Kai Properties at its Imperial Kennedy project, also in Western district. The average discounted price of the first flats released for sale there in November was HK$23,035 per sq ft.</FONT></P> <P><FONT size=4>Despite the pricing, the market response to the release of the flats in The Summa was positive, said Shiu Ka-kuen, a district sales manager at Centaline Property. "Most of the interested home seekers are upgraders who live in the district," he said.</FONT></P> <P><FONT size=4>In contrast, many buyers who had indicated an interest in units in The Diva were investors, according to Eddie Tao, at Hong Kong Property Agency.</FONT></P> <P><FONT size=4>Kerry Properties is part of the Kerry Group, which also controls SCMP Group, publisher of the <I>South China Morning Post.</I></FONT></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=700 2013-12-13 <![CDATA[Time to fix glaring loophole in Hong Kong's property stamp duty]]> <font face='Arial, Helvetica, sans-serif'><P><FONT size=4>(South China Morning Post)A loophole in the new stamp duty has created the impression that it's one rule for the rich and another for the rest of us.</FONT></P> <P><FONT size=4>As one of its cooling measures to calm the red-hot property market, the government has introduced a bill which enables the doubling of the stamp duty of flat sales worth more than HK$2 million for buyers who already own at least one property. The only exemption is for those who are permanent Hong Kong residents who don't own a flat.</FONT></P> <P><FONT size=4>The bill, however, is still stuck in the legislature, though lawyers have been withholding the extra stamp duty. The problem is that there is a glaring loophole in the Stamp Duty Ordinance. It has come to light in recent weeks, partly because transaction volume has picked up again after a period of calm, and some sales are raising eyebrows.</FONT></P> <P><FONT size=4>There have been cases of multiple flats being purchased in one go at luxury estates such as the yoo Residence in Causeway Bay, the Cullinan atop the Kowloon MTR station and The Avenue, a new project in Wan Chai. In each case, the buyers just paid the old stamp duty because the flat purchases were counted as a single transaction. The Financial Services and Treasury Bureau has confirmed the validity of the sales, but the government refused to comment. Despite full knowledge of its existence, officials appear unwilling to do anything about it.</FONT></P> <P><FONT size=4>Critics, however, have pointed out the obvious: this rather large loophole defeats the purpose of the government's own cooling measures to crack down on rampant property speculation.</FONT></P> <P><FONT size=4>One reason for the officials' reluctance to amend the bill and close the loophole is that they already have a nasty fight on their hands, with many pro-business lawmakers fighting against it. That's why it has been lingering in the Legislative Council's bills committee, with no end in sight to its passage despite being tabled in May. So far, it has been having an effect on flat sales because the doubled stamp duty is retroactive. It's not clear whether the government knew about the problem from the start or only afterwards. Either way, it is counterproductive to leave the loophole unchanged.</FONT></P> <P><FONT size=4>It is also unfair, as it obviously favours buyers with deep pockets. They are the kind of people who have the resources to play the property market. Despite the difficulty, it's time for the government to bite the bullet, acknowledge the shortcomings of the bill and work to rectify the problem.</FONT></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=680 2013-11-23 <![CDATA[Hongkongers' interest in buying property falls, Citibank survey finds]]> <font face='Arial, Helvetica, sans-serif'> <p><font size="4">(South China Morning Post)Some 15 per cent of Hongkongers said they were interested in buying property in the last quarter, a drop of more than 10 percentage points year-on-year, according to an annual survey by Citibank released yesterday.</font></p><p><font size="4">Analysts said the government's market cooling measure of an additional stamp duty of 15 per cent on purchases by corporate and non-permanent resident buyers contributed to the drop in purchasing intentions. The policy was introduced in November last year.</font></p><p><font size="4">The survey also found that the average number of property transactions per quarter fell by almost 40 per cent, to 13,000 in the first three quarters of the year, compared with a quarterly average of 21,000 last year and in 2011.</font></p><p><font size="4">Some 1,600 Hongkongers in the 21 to 60 age bracket were surveyed. The margin of error of the survey was 5 per cent.</font></p><p><font size="4">"We saw a steady decline both in people's interest in buying and the volume of property transactions after the introduction of the new measure," said Citibank's head of research, Kit Chow Wai-kit.</font></p><p><font size="4">"Other potential factors such as property prices and salaries have remained stable."</font></p><p><font size="4">Some 15 per cent of those surveyed were interested in buying property, up from 12 per cent in the second quarter.</font></p><p><font size="4">Fanny Lum So-fun, Citibank's head of retail banking products, said the lower-than-expected prices of flats in new housing estates could have caused the rise in interest.</font></p><p><font size="4">She predicted that there would be 16,000 new flats offered next year, which could lead to a 10 per cent decrease in prices and more transactions.</font></p><p><font size="4">Around 45 per cent of people interviewed in September believed property prices would drop over the next two years, compared to 25 per cent in September last year.</font></p><p><font size="4">Some 3 per cent thought it was a good time to buy property.</font></p><p><font size="4">About 61 per cent of respondents believed that mortgage rates would increase next year, compared with 37 per cent last year. Despite talk about the United States cutting back on its "quantitative easing" policy, Lum said the bank believed US dollar interest rates would not increase until mid-2015 and that Hong Kong dollar interest rates would remain stable until then.</font></p><p><font size="4">Half of the survey's respondents owned property, with about 43 per cent having a mortgage. About half of the survey's respondents believed they would not be able to own a flat within the next ten years.</font></p><p><font size="4">About 15 per cent of respondents believed they could afford to buy a flat.</font></p> </font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=663 2013-08-17 <![CDATA[Property developer expects no price drop]]> <font face='Arial, Helvetica, sans-serif'> <p>(South China Morning Post)Wheelock Properties, the biggest landlord in Tseung Kwan O, said there is little room for housing prices to drop because of high construction costs.</p><p>"Construction is now more expensive than land. This is unprecedented," said vice-chairman Stewart Leung Chi-kin.</p><p>He said construction costs, both in terms of human resources and materials, had increased 50 per cent in the past few years.</p><p>In July, Wheelock bought a seaside plot in Tseung Kwan O for HK$3.67 billion, or HK$4,288 per square feet, 6 to 13 per cent lower than the prices at which seaside lots were sold last year. It planned to invest HK$8 million in a residential project on the site that would include high-rise apartment buildings and sea-view detached houses.</p><p>Leung said the area was well equipped and densely populated, and had great potential to become the next central business district after Central and Admiralty. But he added that the government needed to find a way out for the environmental problems caused by the landfill site in southeast Tseung Kwan O.</p><p>The company has bought four plots in the satellite town totalling 2.34 million sqft for HK$9.9 billion since last year. The first project is expected to be launched next year, with prices of more than HK$10,000 per square foot.</p><p>Although Leung sounded confident, sales of first-hand residential properties have been hit by the new ordinance in April aimed at shielding buyers from dishonest practices.</p><p>Research by Centaline Property Agency in July said the inventory level of residential properties, or the ratio of unsold units, stood at 14.6 per cent - the highest in nine years.</p><p>To clear its 15 remaining units, Hongkong Land offered a 5 per cent discount for the Serenade project in Tai Hang last month. From Tuesday, Kerry Properties will sell the last 35 flats at its Lions Rise project in Wong Tai Sin at discounts of up to 9 per cent.</p> </font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=583 2013-06-06 <![CDATA[Buyers return to property market]]> <font face='Arial, Helvetica, sans-serif'> <p>(South China Morning Post) Property transactions rebounded significantly last month from a 15-month low as price declines lured buyers back into the city's market.</p><p>Data from the Land Registry yesterday showed it received 5,288 property sale and purchase agreements for registration, 20.5 per cent more than in April. Year on year, the figure fell 54 per cent.</p><p>Residential transactions jumped 24.8 per cent to 4,276.</p><p>"As home prices decreased gradually, end-users quickened their pace in returning to the market," said Patrick Chow Moon-kit, the head of research at Ricacorp.</p><p>"With the introduction of the Residential Properties (First-hand Sales) Ordinance, the primary flat market lacked attraction and drove buyers and agents back to the secondary market."</p><p>The value of home sales last month totalled HK$24 billion, up 28.4 per cent from April. The total value of all property sales fell 2.4 per cent to HK$31.1 billion.</p><p>"Sales volume may climb by a few hundred this month because of an improved market," said Centaline Property Agency research head Wong Leung-sing. "But the figure is still very low, actually."</p><p>Wong said transaction costs, such as stamp duty, had increased after the government's tightening measures, and home prices would not drop much before interest rates rise in about two years.</p><p>As a result, residential transactions were unlikely to jump, he said.</p><p>Land Registry figures mainly relate to sales in the previous month, as deeds can be lodged 30 days after the transaction.</p><p>Jeffrey Ng Chong-yip, a senior executive director of Hong Kong Property Services, expects total property transactions to remain at about 5,000 in this month's data, as few primary housing projects hit the market in May, although secondary flat sales rose.</p> </font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=525 2013-04-10 <![CDATA[Government needs better ways to rein in property prices]]> <font face='Arial, Helvetica, sans-serif'> <p>(South China Morning Post) It's no secret that since late 2009, there have been valiant attempts to moderate the rise in property prices in Hong Kong.</p><p>In the past three years the government and related agencies have intervened in the property market no fewer than 25 times, introducing additional stamp duties - a Special Stamp Duty and a Buyers' Stamp Duty - and mandating banks to lower their maximum mortgage advance ratios and run increased interest rate stress-test scenarios. Most recently, it doubled ad valorem stamp duty rates.</p><p>Given Hong Kong's fixed exchange rate system and the United States Federal Reserve's unprecedented multiple rounds of quantitative easing, the city has no option but to import a low-interest-rate regime and watch billions of dollars pour into the property markets unfettered.</p><p>With the barrage of direct and unprecedented government interventions in the local property market in the past three years, have these measures achieved their unspecified goal? If the goal has been to moderate the rise, or dampen residential property prices, the data shows that the collective measures have been largely ineffectual, as prices have continued to rise by 35-40 per cent since the first measures were implemented in 2009.</p><p>Interestingly, most of the measures have targeted transactions (flow) rather than existing holders of property (stock). For example, in November 2010, the Special Stamp Duty was introduced to disincentivise short-term buyers/investors. On the surface, it succeeded in eliminating confirmor purchases of new homes and significantly reduced speculation in the secondary market.</p><p>However, the reduction in property market liquidity created unintended consequences that continued to drive prices higher as intrinsic demand from genuine buyers remained strong against a market backdrop with substantially reduced liquidity. Rather than step back and ask why the measures have not succeeded, or which measures would be more effective, the government continues deeper into uncharted territory.</p><p>A broad spectrum of market watchers have suggested the government communicate when it will retreat from market interventions and allow transactions under normal conditions.</p><p>While analysing the impact of the current measures is important, there are other measures that would be more effective at addressing the root of Hong Kong's surging property prices, rather than its symptoms.</p><p>First, contrary to policies, maintaining unfettered market liquidity is critical in achieving the desired goal of dampening property prices. When liquidity is artificially withdrawn from a market, the normal price-clearing mechanism where a willing seller and a willing buyer agree to transact is altered (as is the case with the recent stamp duties).</p><p>Second, most market experts agree that property financing costs are usually one of the main drivers in deciding whether to rent or buy. In Hong Kong, with negative real interest rates and mortgage rates substantially below rental yields, it's no wonder that more people are buying - even at today's record prices.</p><p>Here are three concrete measures to directly address the property bubble:</p><ul><li> increase financing costs;</li></ul><ul><li> increase government rates;</li></ul><ul><li> introduce a property-only capital gains tax.</li></ul><p>With the government continuing to advocate maintaining the US dollar peg, which results in disproportionately low financing rates and inflated asset prices, the Hong Kong Monetary Authority's action on February 22 to increase the banks' capital-risk weighting of residential mortgages by 50 per cent (from 10 per cent to 15 per cent), was a key contributor to banks' increase in mortgage interest rates of 0.25 per cent shortly thereafter.</p><p>Anecdotal evidence suggests that this increase in mortgage rates and the expectation of future rate rises is largely responsible for the nominal reduction in property prices. Prior to the Basel II rules, which set global minimum capital requirements for banks, the HKMA permitted a concessionary risk weighting of 50 per cent for residential mortgages. Therefore, it still has ample room to bring mortgage rates in line with market levels.</p><p>For a more direct and equitable impact, the government should consider increasing the cost of holding properties by increasing annually assessed rates.</p><p>In Hong Kong, government rates for homes are approximately 0.1 per cent. Because nearly all properties are leasehold, the government assesses an annual rate based on rental value, rather than assessing a property tax.</p><p>In many other countries, property taxes have proved an effective tool in moderating price increases. California charges an annual property tax of 1 per cent of the assessed value, and in London the rate is 1.4 per cent. Therefore, with low mortgage financing rates hovering at 2.5 per cent and meagre government rates (10 basis points), the cost of holding properties in Hong Kong is among the lowest globally.</p><p>While advocates of Hong Kong's simple and low tax regime would consider this final suggestion a heresy, a capital gains tax on property would be a more effective tool in managing speculators and more equitable in taxing "gains" rather than transactional value as in the case of the Special Stamp Duty. This duty is assessed even if the buyer has sold their property at a loss within the initial three-year holding period.</p><p>Almost all developed countries, and China, have a capital gains tax on properties. This is generally accepted as fairer. Why not Hong Kong?</p> </font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=479 2013-03-21 <![CDATA[Second-hand home transactions hit historic lows]]> <font face='Arial, Helvetica, sans-serif'><font size="4"> </font><p><font size="4">[South China Morning Post]Home sales in the secondary market have plunged to historical lows, hit by increased mortgage rates and developers' competitive pricing strategies on new developments that have lured home seekers away from the second-hand housing sector.</font></p><p><font size="4">With buyers sidelined as they await clearer pricing signals, analysts and property agents believe demand will not pick up again until prices in the mid- to mass housing markets fall by 10 per cent or so, and by more in the luxury sector.</font></p><p><font size="4">"There have been only three transactions in Taikoo Shing so far this month," said Kenneth Chiu, assistant sales manager for Centaline Property Agency's Taikoo Shing branch. "It is even worse than the 20 deals done during the Sars scare," he said, referring to the outbreak of severe acute respiratory syndrome in 2003.</font></p><p><font size="4">Average transaction prices in the estate are around HK$11,852 per square foot.</font></p><p><font size="4">The slump comes as the secondary market wrestles with a "double-whammy" of increased mortgage rates and sweeteners offered by developers to help shift units in newly released projects. The fresh challenges follow on the doubling of stamp duty payable by buyers of second homes introduced last month.</font></p><p><font size="4">Hongkong &amp; Shanghai Banking Corp, the local unit of global banking group HSBC and the city's biggest home lender with total residential mortgages of HK$686 billion as at December 31, took the lead in raising its rates on new home loans by 25 basis points to between 2.85 per cent and 3.15 per cent, from between 2.6 and 2.9 per cent. The variation depends on borrowers' credit records. Standard Chartered, Hang Seng and Bank of East Asia followed with similar rises.</font></p><p><font size="4">"The housing market is entering a turbulent period," said Chiu. Besides a landslide in sales of luxury homes, districts like Tin Shiu Wai where average transaction prices were HK$4,400 per sq ft for the area's most active housing estate, Kingswood Villas.</font></p><p><font size="4">Hong Kong Ferry's Green Code project in Fanling has sold 350 flats since it was launched last week.</font></p><p><font size="4">Byrant Man, a sales manager at Ricacorp Properties Tin Shui Wai branch, said five flats changed hands in the district last week versus seven transactions per week in a normal period, despite discounting by sellers. "Individual home owners have cut their asking prices by three per cent but potential buyers remained on the sidelines awaiting further cuts."</font></p><p><font size="4">Buyers in the area are typically first-time home buyers who are more sensitive to interest rates and prices, he said.</font></p><p><font size="4">No deals were recorded in 20 of 50 housing estates according to records monitored by Ricacorp Properties for the week ended March 17, and total sales amounted to 65 versus 62 the previous week.</font></p><p><font size="4">Falling secondary market deals and higher commissions on new home sales have prompted agents to turn their attention to marketing new homes.</font></p><p><font size="4">Adrian Ngan Wai-hung, an executive director of Citic Securities' real estate equity research department, believes developers will be forced to cut selling prices by five to 10 per cent before home seekers are lured back to the market. "And it will take a bigger cut to sell flats priced above HK$10 million," he said.</font></p><p><font size="4">Patrick Wong, associate director of property research at BNP Paribas Securities, said he expected developers "to adopt flexible pricing strategies".</font></p></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=463 2012-12-27 <![CDATA[Fewer new flats sold over Christmas holidays this year]]> <font face='Arial, Helvetica, sans-serif'><DIV class="panel-pane pane-entity-field pane-node-body pane-last pos-1" jQuery1356580326161="98"> <DIV class=pane-content> <DIV class="field field-name-body field-type-text-with-summary field-label-hidden clearfix"> <DIV class=field-items> <DIV class="field-item even first last" property="content:encoded"> <P>Hong Kong's property market is not benefiting from the Christmas spirit, with just a few new homes sold over the holiday period as the latest round of cooling measures bite.</P> <P>"Christmas is a traditional low season for the property industry, but we saw much slower sales this year compared to a year ago," said Jeffrey Ng, the senior executive director of Hong Kong Property Services (Agency).</P> <P>He said the exact Christmas sales data had yet to be finalised, but sales volume had dropped 20 per cent on December 25 and 26 compared with the same period last year.</P> <P>Agents said that over the Christmas holidays, less than 10 flats were sold in The Reach in Yuen Long, a project jointly developed by Henderson Land Development and New World Development; Sino Land's Providence Bay in Tai Po, Chinachem Group's Pictorial Garden in Sha Tin and One West Kowloon in Lai Chi Kok.</P> <P>Separately, since the introduction of the 15 per cent buyers' stamp duty, Ng said, sales in the luxury homes sector had declined significantly even before Christmas.</P> <P>"Investors have nearly left the sector," he said.</P> <P>Midland Realty director Sammy Po Siu-ming said most homebuyers preferred to stay on the sidelines as home prices had shown no sign of a big fall so far.</P> <P>The Centa-City Leading Index, which tracks prices at 100 housing estates in the city, closed at 114.97 for the week to December 16, ending four consecutive weeks of falls after reaching a record 116.81 for the week of November 11. The index's base period uses the 100 recorded in the first week of July 1997.</P> <P>"The market will become clearer when developers start releasing their new projects next month," Po said. "Their pricing strategy will certainly have an impact on secondary market transaction prices."</P> <P>Ignoring the weakening market sentiment, Sun Hung Kai Properties said it would release three projects over the next two months amid the government's call to increase supply to meet the city's growing housing demands. The projects are The Wings' phase two development in Tseung Kwan O, Residence 88 in Yuen Long, and Imperial Kennedy in the Western district.</P> <P>Victor Lui Ting, SHKP's deputy managing director, said the developer hoped to generate about HK$30,000 per square foot for Imperial Kennedy.</P> <P>Po said he believed sales would rebound over the Lunar New Year on February 10 to 13 - a peak season for property.</P> <P>"With expectations of an overall improvement over the upcoming Lunar New Year, some home seekers may buy early instead of waiting for the market to turn hot again," he said.</P></DIV></DIV></DIV></DIV></DIV></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=397 2012-05-31 <![CDATA[New flats for old prices create a stir for society]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy>Against a backdrop of high prices and low transactions in the secondary housing market, homebuyers are excited about a new project in Sham Shui Po, where flats are being presold at secondhand prices. <P>Heya Green, a non-subsidy 327-unit development by the Hong Kong Housing Society, has attracted more than 50,000 visitors to its showflats since the project was launched on May 21. <P>The homes on Po On Road are being offered exclusively to Hong Kong identity card holders. <P>In the first week of the launch, at least 1,300 applications were submitted for the 180 flats released - marking an oversubscription of 7.5 times - with prospective buyers required to include draft checks for HK$200,000 along with their applications. <P>"Buyers mostly believe the quality of flats [by the society] is usually better, because it normally builds public housing and is more trustworthy," said Eddie Hui Chi-man, deputy director of the Research Centre for Construction and Real Estate Economics at Hong Kong Polytechnic University. <P>The Housing Society is usually known for building government- subsidized housing, such as rural public housing, sandwich-class housing and senior citizen residences. <P>Most Heya Green homes are two- or three-bedroom flats sized between 567 and 777 square feet. The flats do not carry any resale restrictions. The first batch of 60 units released by the Housing Society was priced at an average of HK$7,723 per square foot. The second and third batch of 30 flats each cost an a</SPAN> <TABLE id=Table2 border=0 cellSpacing=0 cellPadding=9 width=250 align=right vAlign="top"> <TBODY> <TR> <TD></TD></TR></TBODY></TABLE><SPAN class=bodyCopy>verage of HK$7,920 and HK$8,200 psf, and the fourth batch of 60 flats was priced at an average HK$8,179 psf. <P>Smaller flats at relatively new projects nearby - such as the Aqua Marine, The Pacifica, Banyan Garden and Liberte - are commanding a minimum HK$8,000 psf. <P>Heya Green is likely to affect the resale prices of flats at such projects, Hong Kong Property assistant district director Dave Ma Tai-yeung said earlier, with asking prices expected to rise by about 5 percent. <P>Applications for Heya Green flats are open until Sunday. A Hong Kong ID card holder can apply for only one flat, and applications under a company name will not be accepted. <P>The Housing Society is expected to draw lots on June 9 to come up with the buyers' list. <P>Hui said the popularity of Heya Green is fueled by the continual low interest rate environment. "For those who end up failing to buy a flat in the new project, they may turn to the older ones in the neighborhood. This would instantly drive the prices of secondary flats upwards," he said. <P>Apartments in 14-year-old Cornin Garden, a project under the Home Ownership Scheme that was also developed by the Housing Society, now cost about HK$4,497 psf on the secondary market. <P><EM><FONT color=#999999 size=2 face="Arial, Helvetica, sans-serif">News from the Standard</FONT></EM></SPAN></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=369 2011-12-29 <![CDATA[Highs and lows]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy>Hang on to your hat - the Hong Kong property market is taking everyone on a roller coaster ride. Housing prices climbed to their peak during the week of June 5, when the Centa-city Leading Index - which measures price movements in the SAR's property market - hit 100.72. <P>Last week, the index dropped to a 36-month low of 96.81. <P>Not long after prices reached their 2011 plateau, developers started launching sales at new projects. <P>According to Hong Kong Property, 14 new projects were introduced in the fourth quarter, with 2,770 new flats available so far - up 37 percent from 2,020 new units in the third quarter. These 14 projects could provide as many as 5,432 flats. <P>Projects in the New Territories represent about 70 percent of new inventory, or 1,914 homes. Hong Kong Island accounts for 20 percent, or 541 flats, and Kowloon 11 percent, or 315 flats. <P>However, the more flats developers threw on stream, the lower the prices became. <P>For example, at Festival City 3 in Tai Wai, Cheung Kong (Holdings) (0001) originally indicated it would price the new flats with reference to neighboring flats in the secondary market, or at least HK$9,000 per square foot. Instead, the first 240 flats were launched at an average of HK$8,113 psf - nearly 11 percent lower. <P>Phase three prices were also lower than those at Festival City 2, which fetched HK$8,300 to HK$8,500 psf when flats there hit the market in November last year. </P> <P>A similar situation also unfolded recently at The Wi <TABLE id=Table2 border=0 cellSpacing=0 cellPadding=9 width=250 align=right vAlign="top"> <TBODY> <TR> <TD><IMG src="http://www.thestandard.com.hk/newsimage/20111229/6_2011122819211706419Marinella01.jpg"></TD></TR></TBODY></TABLE><SPAN class=bodyCopy>ngs, developed by Sun Hung Kai Properties (0016). The first batch of 50 flats atop Tseung Kwan O MTR station sold in October at an average HK$12,698 psf. <P>Two weeks later, SHKP introduced new batches averaging HK$8,118 psf - 36 percent cheaper. <P>Centaline Property co-founder Danny Wong Man-yin said this trend may signify that developers feel pessimistic over the market outlook. <P>"As developers are generally viewed as the smart money in the industry, their moves to cut prices may adversely impact the market confidence of secondary owners and buyers, as their action implies the outlook is negative," he said. <P>During good times, Wong noted, new apartments generally command prices about 30 percent higher than secondary homes in the same area. But now, the premium is only around 10 percent. <P>"If the developers felt optimistic about the market, why price the flats so low?" Wong said. <P>Woes in the primary market have a huge impact on secondary units. <P>"Buyers' attention has drifted to the primary market, as some new projects are priced close to the neighboring secondary flats," said Midland Realty vice chairman Albert Wong Kam-hong. <P>During the past four-day Christmas break, only 16 transactions were recorded among the city's 10 benchmark residential projects, compared with 67 deals last year, and 80 in 2009. Transactions on the previous weekend were even lower - at eight. <P>Danny Wong partly blames property price drops on the mainland's slumping export volume. <P>"Mainland exports are slowing down, and buying interest from the mainlanders has slowed dramatically due to the deteriorating economic outlook," he said. "It wouldn't be surprising to see some of them selling their properties in Hong Kong to cash out." <P>Mainland buyers have become a major force in the local housing market, accounting for about 30 percent of sales at some primary residential projects - up from only 2 percent in 2008. <P>"Thirty percent is a rather high level. I don't see it climbing further next year," said Eddie Hui Chi-man, deputy director of Hong Kong Polytechnic University's Research Centre for Construction and Real Estate Economics. <P>"Some of them might be affected by the decrease in exports. But don't forget there are home purchase limits in effect in the mainland property market. If they can't invest [there], they can only go to other places. <P>"Hong Kong would still be one of their most preferred areas to buy property." <P>Hui said the local property market will stabilize if China's economic growth can be maintained at 8 percent next year. He foresees housing prices here slipping 5 percent in 2012. <P>Most property experts predict price drops ranging from 10 to 20 percent next year. However, former UBS property analyst Franklin Lam Fan-keung - who is known for his bullish views - forecasts prices to rise by 15 percent instead, despite a 5 percent dip in the short term. <P>"Exports in Hong Kong are still weak, due to the debt issues in Europe," said Lam, founder of the think-tank HKGolden50. "That will put some pressure on property prices in the short run. <P>"However, it has a limited effect on the unemployment rate, which remains at a low level. Expansion of the workforce will drive the hike in residential demand. Along with the continual low interest rate environment, and the tight land supply, the property market next year should see healthy development." <P>Lam cautioned the government against changing its policies according to market conditions, suggesting instead that it make the market adapt to existing policies. <P>Earlier this month, Secretary for Housing and Transport Eva Cheng Yu- wah hinted that the administration may review the Special Stamp Duty before it hits the two-year anniversary mark. <P>But the next day, Chief Executive Donald Tsang Yam-kuen reiterated that he has no intention of removing the property cooling measures. <P><FONT color=#666666><EM>News from the Standard</EM></FONT></SPAN></P></SPAN></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=361 2011-10-06 <![CDATA[All eyes on Tsang]]> <font face='Arial, Helvetica, sans-serif'><P><SPAN class=bodyCopy>Private residential properties are beyond the reach of many people in the low- income bracket and those who want to buy a flat for the first time will be keeping an eye on next week's policy address.</SPAN></P><SPAN class=bodyCopy> <P>Surveys last month found that while prices of private flats have declined in recent months, there are those who will not be able to afford one for at least another 10 years. Demands have grown for more public housing especially for low- income earners.</P> <P>People waiting to hear any policy news related to public housing may yet find out what new announcements will be made when Chief Executive Donald Tsang Yam-kuen delivers the last policy address of his term next Wednesday. <P>He has so far indicated that he will consider various approaches to subsidized public housing and offer "practical measures" to housing and other concerns such as the widening wealth gap. <P>The public is keen to know how many flats will be built under the Home Ownership Scheme. <P>Souces said the first batch of HOS flats - probably 2,000 to 3,000 - is expected to be available in at least three to four years.</P> <P>But the core question is how the scheme will impact the private residential market, a key pillar of the economy. Tsang has been known for not wanting to pave the way for another crash in the housing market, unlike his predecessor Tung Chee-hwa who announced 85,000 new HOS flats but later shelved the plan. Indications are that the administration will announce fewer than 5,000 public housing units, <SPAN class=bodyCopy>so the financial markets will not be jolted and dragged down further. </SPAN><SPAN class=bodyCopy>The Hang Seng Index lost 22 percent during the three months ended September 30. This has been its worst quarterly&nbsp;loss in a decade. Real estate stocks have not been spared in these volatile times. </SPAN></P><SPAN class=bodyCopy> <P>Cheung Kong (0001) gave up 26 percent in the period and Sun Hung Kai Properties (0016) lost 23 percent. Landlord Hysan Development (0014) slumped 38 percent in the quarter. Still, this may present a buying opportunity.</P> <P>"We believe Hong Kong property stocks are cheap for long-term investors, however, they may still be subject to short-term share price declines if a new crisis breaks out," wrote Citigroup analysts Ken Yeung and Griffin Chan. <P>A possible revival of the HOS, introduced by the Housing Authority, has been discussed widely in the months leading up to the policy address. <P>In his policy speech last year, Tsang said: "Some people want the government to use proposed [public rental housing] sites to build HOS flats. Any proposals that may undermine our pledge to maintain waiting time of three years for public housing are unacceptable." <P>Launched in 1978 and halted since 2003, the HOS has been described as one of the most dependable ways to stop home prices from surging. With residential property prices rising rapidly before new tightening measures such as special stamp duties were announced in November, more people have demanded the revival of the scheme. <P>That was then. This is now. Tsang also mentioned last year that "there are diverse views on the resumption of HOS." <P>The easing of property prices and falling deals recently may prompt the government to rethink the scheme's implementation. <P>At 50 major residential projects there was a 20 percent week-on-week decline in deals last week. Only 127 flats changed hands between September 26 and October 2, said Ricacorp director David Chan Tai-wai. This marked a six- year low. <P>"Both buy side and sell side remain inactive before the policy address. Quality homes may attract higher prices, while ordinary homes could be sold at good discounts," Chan said. <P>Hong Kong Polytechnic University building and real estate professor Eddie Hui Chi-man said the recent turnaround in the property market may compel the government to reduce the number of HOS flats that may be built. "HOS flats are needed for sure, but 5,000 seems to be a reasonable level as home prices are currently going down." <P>He estimates 3,000-5,000 flats would be enough in the first year, if the scheme were to be revived. "It could also put units onto the market faster." <P>Hui believes the resumption of the HOS can help the property market find the right balance. "Prices will not necessarily plunge. But the market will get healthier, thanks to more viable supply." However, Chinese University of Hong Kong economics associate professor Andy Kwan Cheuk-chiu said 5,000 HOS flats will not satisfy demand. "Building 5,000 units annually would do nothing to solve the housing problem," Kwan said. <P>He suggests the government build 8,000-10,000 HOS units every year to "relieve housing pressure in a more direct and timely manner." <P>Kwan said the HOS can help home prices reach a more reasonable and affordable level. "It does not necessarily mean that the property market will suffer. It would instead help to restore order." <P>Real estate agencies think otherwise. <P>Centaline research director Wong Leung-sing said resuming the HOS will affect home prices. "It's all about sentiment." <P>To minimize any possible impact on the market, HOS flats should only be sold to first-time buyers, Wong said. "Each can have one and only one chance to buy an HOS flat." <P>Centaline founder Shih Wing-ching goes further, saying "the move will badly affect flat owners." He said most buyers are mainlanders, while locals just cannot afford expensive properties. <P>"Right now many mainland investors are coming here with lots of money. The prices suggest there is a bigger demand for investment rather than domestic use." <P>Citigroup does not expect strong measures to be announced in the policy address. <P>"Home prices have stopped the uptrend since June, so previous measures are considered to be effective with minimal participation from short- term investors and speculators," Citigroup said in a research note. The analysts believe the government is likely to propose 5,000 HOS flats annually, compared with an historical average of 15,000. <P>"However, we estimate the first batch of HOS units will not come before 2015." How many subsidized homes will be built only Tsang will tell.</P> <P><FONT color=#666666 size=2 face="Arial, Helvetica, sans-serif"><EM>News from the Standard</EM></FONT></P></SPAN></SPAN></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=354 2011-08-24 <![CDATA[Rent surge hits restaurants]]> <font face='Arial, Helvetica, sans-serif'><H2 id=ART><FONT size=4>Street-level premises, even in non-prime areas, see rents double as landlords cash in, forcing restaurateurs upstairs or out of business</FONT></H2> <P>Landlords of street-level shops in Hong Kong are demanding big rent increases as leases come up for renewal, forcing tenants to quit in search of cheaper premises. </P> <P>The rolling rent rises have extended from primary to secondary locations, despite a market outlook that remains clouded by global economic uncertainty. <P>Restaurant operators on Canal Road West and Leighton Road, Causeway Bay - which cater for a largely local clientele - have been informed by their landlords that rents will increase by up to 110 per cent. <P>"Rents for street-level shops in first-tier locations have increased to sky-high levels, and the ripple effects will fuel rent rises in fringe areas. Disregarding locations, landlords think every shop is now a goose that lays a golden egg," said Joe Lin, senior director of retail services for property consultancy CB Richard Ellis. <P>Lin said hotels catering to big-spending mainland tourists had provided a shot in the arm for retail properties. In June, the 258-room Best Western Hotel at the junction of Bowrington Road and Canal Road West opened. With the soon-to-open 90-room Vela Pacific in Morrison Hill Road, there will be six hotels in the area. <P>Japanese restaurant Wallmann Market, located near Best Western, will close this month after the landlord raised the monthly rent to HK$180,000 from HK$85,000. Owner Ruby Wong said it was extremely difficult for small restaurants to survive. She opened the 1,000 sq ft restaurant eight years ago, when her monthly rent was just HK$45,000. <P>"Our set lunch sells for HK$40 and most customers are white-collar workers from nearby offices. If I increase the set lunch to HK$60, who will come? <P>"We are not a jewellery store, or an international flagship store that can afford to pay high rent." <P>Wong said the big increase arose mainly because the new owner needed to justify its investment after buying the shop for HK$45 million in March. The yield under the old rent would be only 2 per cent a year. But a monthly rent of HK$180,000 would now bring a yield of 4 per cent. <P>A step away from Wallmann, the 600 sq ft kebab shop Pakora &amp; Spice will also close this month. <P>"We are struggling to survive as rental and food costs keep rising," said Mable Chan, a former web designer who opened the shop with her husband eight months ago. "The landlord has accepted our early termination as he believes he will generate higher rents from the next tenant." <P>Chan said food costs alone had jumped 30 per cent this year, making it difficult for a small shop like hers to compete with fast food chains like Maxim's, which opened recently in the area. <P>The 3,000 sq ft Nam Ah Restaurant in Leighton Road, which serves Singaporean and Malaysian cuisine, will close its doors in November after its landlord increased its rent to HK$360,000 from HK$255,000. <P>"We cannot sustain our business at a rent exceeding HK$300,000 a month. No matter how hard I work, it is impossible to make a profit," said owner Lam Doon. <P>Lam said he had found 4,000 sq ft premises on the first floor of a commercial building in a nearby area in order to continue operating. Rents there were only one-third of the new asking rate, he said. <P>"It is a most difficult time to do business now as rents spiral upwards. It is the first time we have had to relocate to an upper floor since my father started the restaurant in 1964. At the peak of our business we had five outlets. Now we are down to only one," said Lam. <P>Helen Mak, a director of retail services at Colliers International, said the recent dramatic change in market sentiment had had little negative impact on the retail leasing market, and she was unaware of any retailers holding back on their expansion plans. <P>"Since 1996, noodle shops and rattan furniture stores in Canton Road, Tsim Sha Tsui, have been edged out by jewellery retailers who can pay rents of millions of dollar a month. It is hard to blame landlords for charging higher rents if the area is undergoing a dramatic change," she said.</P> <P><EM><FONT color=#333333 size=2>News from the SCMP</FONT></EM></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=351 2011-02-10 <![CDATA[Homing in on new builds]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy>At least 10,000 new flats will come on to the local housing market this year to boost supply, but prices are likely to keep rising. "More than 17,000 flats will be needed this year, and the 10,000 units will not be sufficient," said Cheung Kong executive director Justin Chiu Kwok- hung, who expects home prices will rise by 10 percent in 2011. <P>Supply may gradually increase as Financial Secretary John Tsang Chun- wah reportedly plans to announce a boost in land supply in his budget speech on February 23. <P>However, Tsang may not introduce further tightening measures to curb property speculation. <P>Cheung Kong will sell seven projects in Hong Kong with about 3,500 flats in 2011, including the latest project, Uptown in Yuen Long. <P>A further 1,100 flats from Phase 2C of Lohas Park in Tseung Kwan O will also hit the market. <P>Sun Hung Kai Properties will sell homes at Imperial Cullinan in West Kowloon, UniQ in Shau Kei Wan and Park Nara in Yuen Long. <P>Henderson Land Development is expected to put 1,200 flats on the market, including homes at its projects at Lok Wo Sha in Sha Tin and Tai Tong, Yuen Long. <P>Chiu warned that the local property market will remain volatile, despite the fact that prices are on the upside. <P>Midland Realty director Albert Wong Kam-hong agreed. "Government policies will keep changing market sentiment," Wong said. "Prices will keep on growing, at a relatively slower pace." <P>The government introduced curbs last November that initially squeezed spec</SPAN> <TABLE id=Table2 border=0 cellSpacing=0 cellPadding=9 width=250 align=right vAlign="top"> <TBODY> <TR> <TD></TD></TR></TBODY></TABLE><SPAN class=bodyCopy>ulators. However, just one month later prices surged again. <P>"This indicates that demand from end-users is overwhelming," said Ricacorp head of research Patrick Chow Moon-kit. <P>"More mainlanders are buying homes in Hong Kong due to continuous curbs in China." <P>Last month Shanghai and Chongqing implemented property taxes. Analysts said the taxes, which came into effect on January 28, have resulted in a slowdown of home sales in the two cities. <P>In Hong Kong, people have had pay rises and have more buying power this year, keeping the market buoyant, said Eddie Hui Chi-man, a professor at Hong Kong Polytechnic University. <P>"A limited supply and pay rises at the beginning of this year encourage people," he said. <P>Transactions have been picking up, and more deals were done during the four-day Lunar New Year holiday than over the same period last year. <P>Among the 10 benchmark residential projects, 22 flats were sold during the holidays, compared with only four deals in the same period last year, according to Midland Realty data. <P>"Home prices are expected to rise after the Lunar New Year, so buyers act early before the rally," said Midland chief analyst Buggle Lau Ka-fai. <P>In January, registered transactions for pre-owned homes dipped 14 percent from the previous month, indicating December sales were disappointing. <P>"Smaller homes priced under HK$2 million saw a 28 percent plunge to 2,472, underperforming the overall market," said Hong Kong Property director Jeffrey Ng Chong-yip. "These units accounted for 31.6 percent of total sales last month, as compared to 37.7 percent in December." <P>Overall transactions dipped below 10,000 in January, the first time in 22 months, with 8,002 homes changing hands. <P>"The effect from the tightening measures launched in November remained through the year to January," said Centaline research director Wong Leung-sing. <P>With more new homes launched, secondary home prices are expected to slowly catch up, said Ricacorp's Chow. <P>Midland's Lau said home owners jack up prices because they expect good sales in new projects nearby. But he warned: "If prices of secondary flats are getting close to new homes, why would buyers consider older flats?" <P>The fast-growing prices concern the government, analysts said. RBS (Hong Kong) analyst David Ng Ka-chun expects the tightening policy to continue this year because of the buoyant market. <P>"I think Hong Kong's property prices have over-shot," Ng said. "Another 5 percent gain in price in the first few months of the year could trigger another round of tightening." <P>He expects the growth rate of Hong Kong property prices to be unchanged from last year. <P>Housing prices have risen more than 50 percent since the beginning of 2009, according to property agent Centaline. <P><FONT color=#999999 size=2><EM>News from the Standard</EM></FONT></SPAN></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=348 2011-01-06 <![CDATA[Quick on the uptake]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy>Despite numerous signs pointing to a cooling property market, real estate has instead continued its upward trend, finishing the year with a 15 percent price increase across the board, following a stellar 27 percent jump in 2009. <P>The onerous signs in 2010 included high-profile land auctions that failed to meet the high-end of estimates - including two sites in Tai Po and one in Kowloon Tong - as well as acute government measures to cut down on speculation in November. <P>Last January, a plethora of naysayers in the industry pointed to the sharp price rise in 2009 as evidence that a correction was due within this year. For 2011, analysts have changed their tune - predicting another year of double-digit gains. <P>"The rise will definitely continue," said Patrick Chow Moon-kit, head of research at Ricacorp. <P>He points to four drivers to make his case. The first lies in the relationship between inflation and ultra-low interest rates, which will have a synergistic effect on property prices. <P>"The inflation level, if we go by the forecasts, is going to be 5 percent. That means for 2011, we're going to have negative interest rates," Chow said, adding this will boost property values as more people are going to be buying. <P>"Look at the price of a mortgage. Banks are offering [Hong Kong interbank offered rate] plus 0.8 right now, which amounts to around 1 percent. Some say it might even drop to HIBOR plus 0.65, which would mean an overall interest around 0.85 percent. <P>"If you su</SPAN><SPAN class=bodyCopy>btract the 5 percent inflation figure from that interest rate, you get something around minus 4 percent, which means that in effect, the bank is helping you pay off the loan." </SPAN></P> <P><SPAN class=bodyCopy>The second driver is an economic tenet: tight inventory means high prices. </P> <P>"There will be a low supply in primary properties next year," Chow said, forecasting developers won't release much more than 10,000 homes, with the bulk going on sale after the third quarter. <P>This compared with an average of nearly 20,000 flats released annually from a period starting from 1998 to 2010, although supply has dwindled in the past two years. <P>For 2011, Chow anticipates no projects with more than 1,000 homes will be released on either Hong Kong Island or Kowloon. <P>"The largest development on the island will be in Wong Chuk Hang, at 411 units," Chow said. "In Kowloon, Hang Lung Properties has a large development in Olympic Station called Long Beach, with around 1,104 units, but they haven't shown any signs of releasing them for sale. On the whole, there are going to be significantly fewer units available on the primary market next year." <P>Chow said the flats that will go on sale will be concentrated in the New Territories. "These will appeal to a specific set of buyers, so they're not going to alleviate demand in a big way." <P>The third driver, Chow noted, is the rising wealth of Hong Kong citizens. <P>"We now have a record amount of money in bank deposits at over HK$7 trillion. This is a landmark," he said. "In 1997, we had around HK$2 trillion. This means that Hong Kong people are going to have ample cash to purchase property for the foreseeable future." <P>The fourth driver is the continued liquidity flow into Hong Kong from the mainland. As mainlanders have grown richer, the fiscal policy of the central government has centered on deflating asset bubbles. A key component of that strategy, Chow said, is increasing capital outflows. <P>"Much of this capital leaving China, of course, is going overseas, for example, to Japan or Europe, which in recent history have been favored destinations for mainland money," he said. <P>"But there will always be a number of investors who prefer to stay closer to home, and therefore will invest in the property market in Hong Kong." <P>There are risks that more government measures will be imposed to cool the market, Chow said, but as 2009 has proven, they will be speed bumps rather than game-changers. <P>"Of course, policy risk is now going to be more and more of a factor in the equation. The government won't let prices rise ridiculously - or more than 20 percent," Chow said. "So it'll be a rocky climb consisting of alternating price rises, and price plateaus due to government cooling measures. But the direction will remain the same. <P>"I predict prices will go up by 10 to 15 percent this year." <P>Buggle Lau Ka-fai, chief analyst at Midland Realty, agrees that housing prices will continue rising - but steadily, in spurts - tempered by government policies. <P>Lau believes the increases on the whole will be more measured, and reflect the smaller number of transactions that are predicted to occur. <P>"Our view is that secondary prices will likely increase further, we estimate in the range of 10 to 11 percent for this year," Lau said. <P>"They will be less than last year, due to new policy measures and the historical price runup." <P>Because the fundamentals remain the same - rising liquidity, low interest rates and an accelerating economy - Lau said the general trajectory is going to continue. But these factors will be tempered by the drop in transaction volume, which Lau puts at about 18 percent. <P>"We estimate a drop from 161,000 to 162,000 [flats] predicted for this year to around 132,000. This can be directly attributed to the anti-speculation stamp duties," Lau said. <P>Another point of view is that long- term investors will feel more secure in entering the market, he said. <P>"With the savings [interest] rate so low, it will make more sense for people to transfer their money from their bank account into bricks and mortar." <P><FONT color=#666666 size=2><EM>News from the Standard</EM></FONT></SPAN></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=342 2010-12-23 <![CDATA[Blue-chip buys on the rise]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy>Weekend transactions of used apartments in Hong Kong rose as an index tracking home prices in the city had its biggest weekly drop in more than six months, according to Centaline Property Agency. <P>Sales at projects including Tai Koo Shing and Mei Foo Sun Chuen increased 25 percent to 66 from a week earlier, said Centaline, Hong Kongs largest closely held realtor. <P>Midland Holdings, the citys biggest realtor by market value, said transactions dropped to 45 from 50. <P>On November 19, the government intensified a yearlong battle to curb surging home prices with additional taxes and policies a day after the International Monetary Fund warned that asset inflation may derail the citys economy. <P>Homes sold within six months of purchase will now incur a 15 percent stamp duty, and downpayments will increase for most mortgages, with those for homes costing at least HK$12 million rising to 50 percent from 40 percent. </P> <P>Louis Chan Wing-kit, managing director for residential sales at Centaline, said some end-users are taking advantage of the recent correction in prices to buy, while long-term investors also prefer these big blue-chip projects for their stable returns. </P> <P>The Centa-City Leading Index, which tracks the citys home prices, fell 1.28 percent in the week ended December 12 from a week earlier, its biggest fall since May 30, to 88.27, Centaline said last week. <P>Hong Kongs residential transactions may fall as much as 35 percent in 2011 from 2010 after the government measures, Midland said earlier this month. <P>Policymakers, including Hong Kong Monetary Authority head Norman Chan, see property-price bubble risks as US monetary easing contributes to capital inflows. <P>Hong Kongs currency peg to the US dollar prevents officials from raising interest rates to cool demand. BLOOMBERG</P> <P><FONT color=#666666 size=2><EM>News from the Standard</EM></FONT></P></SPAN></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=343 2010-12-02 <![CDATA[Wait and see before rebound]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy>On November 19, the Hong Kong government announced its strong dose of new measures to curb excessive property speculation in the local residential market, and enhance risk management in mortgage lending by local banks. <P>The new measures include the introduction of a special stamp duty on residential units, on top of the current property transaction stamp duty; prohibition against deferred payment of stamp duty; and new guidelines to local banks further lowering the loan-to-value ratio for mortgages - raising downpayments. <P>There's no doubt a short-term market consolidation is about to occur over the next three months. Prospective homebuyers currently hold a wait-and- see attitude toward declining home prices, while existing owners who have been looking to sell their properties are expected to offer the homes for lease. <P>Instead of keeping their premises vacant for short-term resale, it's a better alternative to lease them out for the next two years to avoid paying the special stamp duty. <P>This will result in a growing inventory of residential rental stock stemming from investors who are prepared to extend their timeframe. <P>Residential sales volume over the next three months is forecast to drop 20 to 30 percent from the current level of about 11,000 monthly transactions. Meanwhile, average selling prices would fall 5 to 10 percent, with similar downward adjustments for rental homes. <P>The anticipated retreat of short-term property traders will enable the local market to function properly in response to genuine end-user demand. <P>However, the majority of end-users are opting to sit back and wait for higher loan-to-value ratios to be offered. <P>Long-term investors with strong equity backgrounds will be least affected by a short-term downward adjustment in residential rentals. <P>Institutional real estate funds will stay on the sidelines as the higher downpayments required for both residential and commercial properties create difficulties in raising sufficient financing. <P>Although mezzanine loans are available in the marketplace, they are usually obtained at much higher cost, exceeding their funding benchmarks. <P>In the longer-term prospective - notwithstanding the short-term market consolidation - property prices will stage a rebound toward the end of the first quarter in 2011 if the US dollar remains weak, inflation continues to rise, and the low interest rate environment prevails. <P>Joanne Lee is an assistant manager of research and advisory at Colliers International. As the world's third-largest real estate services firm, Colliers provides specialized services across all property sectors. For more information, please visit www.colliers.com. <P><FONT color=#666666 size=2><EM>News from the Standard</EM></FONT></SPAN></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=344 2010-09-28 <![CDATA[Flood of new homes before policy address]]> <font face='Arial, Helvetica, sans-serif'><P><SPAN class=bodyCopy>28th September 2010</SPAN></P> <P><SPAN class=bodyCopy>Developers rushed to tap a revival in market sentiment yesterday with fresh launches prior to the chief executive's policy address next month. </P> <P>Nan Fung Development released the first price list of 30 homes - mostly studio flats - at Queen's Cube for an average of HK$15,570 per square foot. <P>And Sun Hung Kai Properties (0016) announced the prices for 28 villas at Valais. <P>Cheung Kong Holdings (0001), meanwhile, put 302 more flats at Oceanaire on the market, while KWah International's (0173) Shiu Fai Terrace project will be available in mid-October. Registration for Nan Fung's 96-home building in Wan Chai starts tomorrow and sales begin on October 6. Prices range from HK$5.97 million for a 401-square-foot flat to HK$9.32 million for a 582-sq-ft one, or HK$14,888 to HK$16,843 psf. <P>Nan Fung director Victor Mak Yat-king said potential official curbs should have limited effects on sales, since he expects more than 60 percent of buyers to be long-term investors targeting rentals. <P>At nearby Zenith, investors accounted for about 60 percent of buyers, said Midland Realty senior sales manager Barry Tun. Transactions in September have doubled from August to 10, with prices rising by 6 percent to HK$10,600 psf. An investor recently bought a 650-sq-ft flat for HK$6.2 million, or HK$9,508 psf, eyeing a rental yield of about 4.3 percent. <P>In the same district, 5 Star Street - to be completed by year-end - will cost from HK$17,000 to HK$22,000 psf and York Place from HK$14,000 to HK</SPAN><SPAN class=bodyCopy>$16,000 psf. </SPAN></P> <P><SPAN class=bodyCopy>In Sheung Shui, SHKP will start selling the first 28 villas at Valais for an average of HK$8,388 psf on National Day. The cheapest five are HK$8,100 psf, or around HK$20.5 million. Sun Hung Kai Real Estate Agency executive director Victor Lui Ting said there is plenty room for price increases. </P> <P>In Ma On Shan, Cheung Kong will sell 288 apartments and 14 houses at Oceanaire for an average of HK$6,811 psf and HK$8,353 psf, respectively. Another 424 homes will go on sale from Thursday. <P>The cheapest flat costs HK$3.8 million. <P>KWah's 16-story building in Happy Valley will provide 24 apartments. Typical flats measure 3,600 sq ft. Special apartments are 7,200 to 7,300 sq ft. <P>Chief Executive Donald Tsang Yam-kuen's policy address is on October 13. <P><FONT color=#999999 size=2><EM>News by the Standard</EM></FONT></SPAN></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=334 2010-07-23 <![CDATA[URA invites bids for Sai Ying Pun site]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy>The Urban Renewal Authority has invited firms to apply to redevelop a 23,143-square-foot site in Sai Ying Pun. <P>The site, bordering Third Street and Centre Street, may provide a total gross floor area of 177,175 sq ft, mainly for residential use, the URA said. <P>It intends to provide about 270 homes, including a large number of units smaller than 500 sq ft. <P>Judging from the URA and Kerry Properties' (0683) Island Crest nearby, smaller homes could potentially cost buyers more per square foot. <P>Comparable homes at the redevelopment project in First Street and Second Street were sold for just above HK$14,000 to around HK$18,000 psf early this year, higher than units of about 800 sq ft, said Hong Kong Property sales manager Anthony Wong. "Small units involve small lump-sums and have good rental yield," Wong said, noting the supply of these units is low in the district. <P> <TABLE border=0 cellSpacing=0 cellPadding=9 width=250 align=right valign="top"> <TBODY> <TR> <TD> <CENTER> <DIV style="POSITION: absolute; VISIBILITY: hidden; TOP: 0px; LEFT: 0px" id=beacon_4645cffdfa><IMG style="WIDTH: 0px; HEIGHT: 0px" alt="" src="http://203.80.0.221/openx-2.6.4/www/delivery/lg.php?bannerid=34&amp;campaignid=3&amp;zoneid=4&amp;loc=http%3A%2F%2Fwww.thestandard.com.hk%2Fnews_detail.asp%3Fpp_cat%3D1%26art_id%3D100864%26sid%3D28996542%26con_type%3D1%26d_str%3D20100723%26sear_year%3D2010&amp;referer=http%3A%2F%2Fwww.thestandard.com.hk%2Fnews_search_resu.asp&amp;cb=4645cffdfa" width=0 height=0></DIV></CENTER></TD></TR></TBODY></TABLE> <P>The URA said it also plans to re-use a pair of existing tenement buildings as public open space. <P>Interested parties have to prove development experience and financial capability, and submit expressions of interest by July 30. <P>Meanwhile, URA chairman Barry Cheung Chun-yuen noted criticism of excessively large bay windows at Lime Stardom, co-developed with Sun Hung Kai Properties (0016), and said the issue would be discussed with the Development Bureau. He personally supports a cap on size. DEREK YIU</P> <P><EM><FONT color=#666666 size=2>News from the Standard</FONT></EM></P></SPAN></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=324 2010-04-07 <![CDATA[Property sales rise 20pc]]> <font face='Arial, Helvetica, sans-serif'><P>The number of property sales for all building units received for registration last month rose 20.5 percent over May.<BR><BR>The 15,747 sales and purchase agreements recorded was also a 32.6 percent increase over June last year.<BR><BR>The Land Registry also announced the value of last month's deals amounted to HK$58.2 billion, a 32.2 percent rise compared with May and a 1.2 percent year-on-year increase.<BR><BR>Residential deals accounted for 13,805, a 17.1 percent increase over May and a 35.3 percent year-on-year increase.<BR><BR>The value of these residential deals amounted to HK$49.7 billion, a 26.1 percent increase over May but 1.4 percent down on June last year.<BR></P> <P><FONT color=#333333 size=2><EM>News from the Standard</EM></FONT></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=310 2010-03-25 <![CDATA[Festive atmosphere]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy>Surrounded by mountain views of Lion Rock and Kau To Shan, Festival City phase one in Tai Wai offers luxury and convenience. The residential project by Cheung Kong (Holdings) is scheduled for completion in August. <P>The show flat is a 980-square-foot unit that faces south-east and based on unit D of block one, two, three and five. <P>The unit has a three-bedroom layout featuring an en suite master bedroom and a utility room. <P>The stylish flat, with crystal and glass accents, allows residents to enjoy the sun and Sha Tin landmarks such as Shing Mun River and Amah Rock. <P>The interior design theme is Caramel Delight, which translates to earth tones in the rectangular living-and-dining area, which spans approximately 200 sq ft. <P>The 110-square-foot master bedroom has a mirror wall decorated with crystals, and a cushioned bay window designed for snuggling up with a book. <P>The bathroom and kitchen are equally elegant. The marbled bathroom features a large mirror, while quality tiles, glass and stainless steel surfaces make the kitchen chic yet easy to clean. <P>The remaining two bedrooms contrast dramatically in colors. One has a soft beige color scheme, while the other features a black and gray palette, accented by a zebra-print chair. <P>The striking visual effects continue into the guest bathroom, which has golden mosaic walls. <P>The utility room has been renovated into a study to reflect its versatility. <P>A pendant with 35,000 Swarovski crystals adds glitter to the </SPAN> <TABLE id=Table2 border=0 cellSpacing=0 cellPadding=9 width=250 align=right vAlign="top"> <TBODY> <TR> <TD></TD></TR></TBODY></TABLE><SPAN class=bodyCopy>fully equipped clubhouse, Club Festival. <P>Inspired by California gardens, the Beverly Majestic Garden in Festival City offers wide open spaces, with jogging routes and a corridor adorned with sculptures.</P> <P><FONT color=#333333 size=2 face="Arial, Helvetica, sans-serif"><EM>News from The Standard</EM></FONT></P></SPAN></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=313 2010-02-24 <![CDATA[Economy to grow 4 to 5 pc, predicts John Tsang]]> <font face='Arial, Helvetica, sans-serif'><P>Hong Kong's economy is expected grow by 4.0 to 5.0 percent in 2010, the city's financial secretary John Tsang said in his annual budget speech today.<BR><BR>"I am cautiously optimistic about Hong Kong's economic prospects for 2010,'' Tsang said.<BR><BR>But he said the city had to remain vigilant against any ``possible relapse'' in the economy.<BR><BR>"In the short term, we must carefully adjust the exceptional measures introduced to combat the financial tsunami and tackle the risk of asset-price bubbles.''<BR><FONT color=#333333 size=2 face="Arial, Helvetica, sans-serif"><EM><BR>News from The Standard</EM></FONT></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=314 2010-02-11 <![CDATA[Crest of life]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy>Island Crest by luxury residence developer Kerry Properties in partnership with the Urban Renewal Authority comprises two contemporary residential towers. <P>The project in Mid-Levels West will offer 488 exquisitely appointed residential units with typical gross floor areas ranging from some 500 to 1,200 square feet. <P>Home owners will enjoy all the pleasures of a well-appointed clubhouse that offers diverse facilities. The development also offers a number of duplexes and prime units on the top three floors. <P>Three show flats were launched last week, with themes ranging from elegant to minimalist. <P>Unit A is a three-bedroom 1,186 sq ft home complete with utility room. The living and dining areas are rectangular for maximum practicality. Tall, wide windows let in abundant sunlight and create a sense of expanded spaciousness, while offering good views of surrounding streetscapes. <P>Fabric adorning the walls of the living area and earth-toned walls and floors in the bedrooms give a soft and natural ambience. The semi-open plan kitchen also enhances the unit's sense of spaciousness. <P>Unit B covers 755 sq ft with two bedrooms and a utility room. Though smaller, this unit, which offers sea views, exudes a sense of freshness with its tiled floors and wood panel walls. To fully utilize the space, the bay window of the master bedroom has been transformed into a flexible vanity. <P>The 625 sq ft Unit E offers two bedrooms. The absence of a hallway enhances practicality while the </SPAN> <TABLE id=Table2 border=0 cellSpacing=0 cellPadding=9 width=250 align=right vAlign="top"> <TBODY> <TR> <TD></TD></TR></TBODY></TABLE><SPAN class=bodyCopy>extensive use of glass adds to overall spaciousness. <P>The black, white and gray color scheme creates a modern ambience, balanced by a crystal chandelier above the dining table. One of the bedrooms has been altered into a study to reflect the flexibility of the layout. <P>In addition to typical units, Island Crest offers 26 special units ranging from 1,500 to 3,000 sq ft. <P>Island Crest residents will benefit from the Sai Ying Pun MTR station, which will be ready in 2014. <P>The area is one of the few tranquil, yet convenient, traditional neighborhoods for its close ness to the Central business district and various educational institutions, making it ideal for families and business executives alike. <P>Clubhouse facilities include outdoor swimming pool, children's play pool, jacuzzi, sauna and steam bath, conference room, resting area, reading area, multi-function banquet room, multi- media recreation room, mahjong room, children's play area, BBQ area and a landscaped podium garden. <P>Island Crest <P>Address 8 First Street, Sai Ying Pun <P>Number of blocks 2 <P>Number of units 488 <P>Unit areas 496 to 1,186 sq ft <P>Layouts 1 - 3 bedrooms <P>Developers Kerry Properties and Urban Renewal Authority <P><EM>News from the Standard</EM></SPAN></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=300 2010-01-20 <![CDATA[Home purchases start new year on strong note]]> <font face='Arial, Helvetica, sans-serif'>The new year has got off to a flying start for Hong Kong's property market, with sales surging to a two-year high last week. <P>Data collated by Ricacorp Properties shows 730 sales and purchase agreements were signed in the city's 50 major housing estates in the week to January 17, up from 614 in the previous week and the most recorded in the past 105 weeks.</P> <P>Prices rose 1.1 per cent during the week, taking the cumulative increase in the average prices of secondary-market deals in the past two months to 4 per cent, the data shows. <P>"There is no particular reason for the rise. Buyers just feel good about the market outlook," said Patrick Chow Moon-kit, the head of research at Ricacorp. <P>"Positive factors that have helped boost sales activity include steady economic development and the recent news that a government site in Tseung Kwan O has been triggered for public auction," Midland Realty chief analyst Buggle Lau Ka-fai said. </P> <P>Casting a wider net, data from Hong Kong Property Services (Agency) shows sales agreements for residential, commercial and industrial deals lodged with the Land Registry in the first 15 days of this month were up about 23 per cent month on month to 6,143. The agency expects the number of deals to reach 12,000 this month, the highest since September last year. <P>The sustained market recovery is fuelled by buyers returning after sitting on the sidelines, agents say. <P>A potential buyer is Wong Ka-chun, who has lived with his wife in a rented flat for the past three years but believes now is the time to buy. <P>"Mortgage charges are so low that the purchasing cost is not high. I will take this opportunity to buy," Wong said. "I will then save money to buy a better quality flat in two to three years." <P>Wong said although prices are on the rise, they are still below levels they reached before the global financial crisis in the fourth quarter of 2008. <P>"Even if the crisis happens again and prices plunge 25 per cent from current levels, the potential downside is acceptable," he said. <P>Helping to boost sentiment in the market, the government announced on Friday that it had accepted an applicant's minimum guaranteed bid of HK$2 billion for a 132,397 square foot site in Tseung Kwan O. The site will be triggered for public auction on February 22. <P>Crystal Tam, the head of Centaline Property Agency's Tseung Kwan O branch, said sales activity in the area rose 33 per cent to 43 deals at the weekend, against 30 in the previous weekend. <P>Prices had not yet risen and the difference between asking prices and transaction prices had narrowed as sellers refused to lower prices in anticipation of a better outlook, she said.</P> <P><FONT color=#333333 size=2><EM>News from South China Morning Post</EM></FONT></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=294 2010-01-13 <![CDATA[Top homes tipped to soar]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy>Hong Kong luxury home prices may rise 20 percent this year as the economy expands and supply remains limited, real estate broker CB Richard Ellis said. <P>Mass residential prices may rise 15 percent, CBRE said yesterday. <P>Home prices rose 29 percent locally last year, outperforming Tokyo, London and New York, as record low mortgage costs, near-zero interest rates on savings deposits and buying by mainlanders stoked demand. <P>Existing residential property values, now at the highest in almost 12 years, may rise another 35 percent, according to Centaline Property Agency. <P>"Further gains in the property market will be supported by continued low interest rates and loose monetary policies," said Tony Ng, CBRE senior director for investment properties.</P> <P>Henderson Land Development (0012), controlled by billionaire Lee Shau-kee, said in October it sold a luxury duplex apartment for HK$439 million and claimed a record selling price on a per-square-foot basis of HK$88,000. </P> <P>Lee said last month that home prices will rise another 10 percent in 2010. Henderson's shares more than doubled in 2009, making the stock last year's best performer on the Hang Seng Property Index. <P>Hong Kong's home prices are being bolstered by rising employment and an economic recovery. <P>The jobless rate for the three months ended November 30 fell to 5.1 percent, the lowest in nine months, after the economy grew for a second straight quarter in the three months through September. <P>An index of existing home prices rose to 74.07 in the week ended January 3, the highest since March 1998, Centaline said. The weekly measure may rise to 100, the real estate agency said. <P>The index was last at 100 in October 1997. <P>December home sales slid 9 percent to HK$34.7 billion, the lowest level in eight months, according to the Land Registry. Still, the figure almost doubled from a year earlier. BLOOMBERG.</P> <P><FONT color=#666666><EM>News from The Standard</EM></FONT></P></SPAN></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=295 2009-10-28 <![CDATA[Causeway Bay style]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy>Hong Kong has always had a ruthless operational efficiency about the place, born of the necessity of ensuring freedom - free markets, freedom of the highways, the freedom for a bit of hustle and plenty of bustle. That comes at the risk of cramming its denizens, and in this regard Causeway Bay has always been something of an exception to the rule. <P>The greater part of the district has always been relatively free of congestion despite its synonymity with crowds that have made its shop rents among the world's most expensive. Victoria Park, Central library, Queen's College and harbor areas provide the perfect counterpoint to its more pedestrian attractions, giving it breathing room. <P>The attractions meld at V Causeway Bay2 serviced apartments to offer expats, executives and dealmakers the best of both worlds. The latest building to get V's designer nous brings maximum rest, with its location in the more verdant and quieter neighborhoods, and maximum entertainment options, when guests feel like taking the short walk along the broad avenues to Causeway Bay central. <P>Those two worlds are apparent within as well. A unique state-of the- art security access elevator takes you up to your very own private world. Once you step out, you have the floor all to yourself, literally, whether your choice is Luxe One, Magic Two, Dream Two or Grand Suite. No noisy neighbors, no thin walls, your very own space, lots of it in a stone-finished apartment building that keeps your fun private an</SPAN> <TABLE id=Table2 border=0 cellSpacing=0 cellPadding=9 width=250 align=right vAlign="top"> <TBODY> <TR> <TD></TD></TR></TBODY></TABLE><SPAN class=bodyCopy>d the noise out. Nooks and corners offer clear views. Wooden- decked verandahs caress your soles. <P>The apartments are also stocked with the best shop items to soothe the discerning traveler. Feather duck down pillows and dreambeds with feather tops bring total repose. Free standing bathtubs, rainshowers, towel warmers and fog-free mirrors leave one gloriously cool in summers and snugly warm in winters. Galley-styled kitchens with corrian tops, fresh herbs and Le Creusset cookware make cooking minimum effort and maximum delight. <P>Surround sound equalizer systems, LCD TVs, iPod connections, complimentary Now TV and internet broadband connection, home entertainment systems with DVD players, an inhouse movie library, Wii sets with games ensure that the apartment rocks for you, your family and your friends. <P>For those with bigger budgets, the Grand Suite offers French-style patio doors that lead to stunning terraces, where state-of-the-art barbecue decks and luxury soak tubs make small intimate gatherings unforgettable. <P>So step into the world of V, where fine style and total substance blends in perfect harmony to offer the corporate dealmaker the perfect stay.</P> <P><EM><FONT size=2>News from the Standard</FONT></EM></P></SPAN></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=287 2009-08-10 <![CDATA[West Island Line works start]]> <font face='Arial, Helvetica, sans-serif'><TABLE border=0 cellSpacing=0 borderColor=aqua cellPadding=0 width=430 align=left> <TBODY> <TR> <TD class=theme_news_header>[from Government News]</TD></TR> <TR> <TD><BR></TD></TR> <TR> <TD class=theme_text vAlign=top align=left> <P>Construction of the MTR West Island Line will create 3,000 jobs and bring $62 billion in economic benefits, Chief Secretary for Administration Henry Tang says.</P> <P>Officiating at the line's groundbreaking ceremony at Kennedy Town Praya today Mr Tang said the project will expand the city's railway network coverage, enhancing transport efficiency.</P> <P>The $15.4 billion project will involve a 3km underground extension to the existing MTR Island Line from Sheung Wan to Kennedy Town with two intermediate stations at Sai Ying Pun and the University of Hong Kong.</P> <P>The project comprises the construction three new railway stations, tunnels, procurement of rolling stock, and also associated public infrastructure works, including 2km of pedestrian walkways to improve mobility and connectivity within the district.</P> <P>The journey time, which normally takes up to 25 minutes by road during rush hours, will be slashed to less than eight minutes. It will take only 14 minutes from Kennedy Town to Tsim Sha Tsui.</P></TD></TR></TBODY></TABLE></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=278 2009-07-04 <![CDATA[Property sales rise 20pc]]> <font face='Arial, Helvetica, sans-serif'><P>The number of property sales for all building units received for registration last month rose 20.5 percent over May.<BR><BR>The 15,747 sales and purchase agreements recorded was also a 32.6 percent increase over June last year.<BR><BR>The Land Registry also announced the value of last month's deals amounted to HK$58.2 billion, a 32.2 percent rise compared with May and a 1.2 percent year-on-year increase.<BR><BR>Residential deals accounted for 13,805, a 17.1 percent increase over May and a 35.3 percent year-on-year increase.<BR><BR>The value of these residential deals amounted to HK$49.7 billion, a 26.1 percent increase over May but 1.4 percent down on June last year.<BR></P> <P><EM><FONT color=#999999>By&nbsp;The Standard</FONT></EM></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=268 2008-10-03 <![CDATA[Property prices set for 20pc fall]]> <font face='Arial, Helvetica, sans-serif'><TABLE border=1 cellSpacing=2 cellPadding=2 width="100%"> <TBODY> <TR> <TD> <P align=justify><FONT color=#000000 size=3>Property prices are expected to decline by up to 20 percent by the end of next year amid global financial turmoil and rising mortgage rates.<BR><BR>"Prices in the mass residential market will drop by 15 to 20 percent [by the end of next year], although affordability is still strong," Simon Smith, deputy managing director at Savills Valuation and Professional Services, said yesterday.</FONT></P> <P align=justify><FONT color=#000000 size=3>He said prices in the luxury residential market could fall 25 to 30 percent during the period.</FONT></P> <P align=justify><FONT color=#000000 size=3>"Continued integration with China has alleviated the impact of a slowing economy, the credit crunch, and high inflation on Hong Kong," said David Tse Kin-wah, Hong Kong board chairman of the Royal Institution of Chartered Surveyors, "but scarce supply of developable land in urban areas and the constant inflow of investors' funds into Hong Kong Kong help stabilize the downward trend of residential prices." <BR>&nbsp;<BR>Citi analyst Tony Tsang said in a note: "The latest hikes in mortgage interest rates and declines in property rentals have made us more bearish on Hong Kong property. The downward spiral in the property market will continue, in our view, and corrections will likely overshoot on the downside."</FONT></P> <P align=justify><FONT color=#000000 size=3>Under tightening measures, "[prices] in the mainland property market will drop 20 to 30 percent by the end of next year ... particularly in first-tier cities," Smith said.</FONT></P> <P align=justify><FONT color=#000000 size=3>But he also expects prices to recover as the government will likely implement policies to stabilize the market once it has fallen too much. "They will be careful to support the market," he said. </FONT></P></TD></TR> <TR> <TD><EM><FONT color=#696969>News from the Standard</FONT></EM></TD></TR></TBODY></TABLE></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=263 2008-09-30 <![CDATA[Banks hike mortgage rate]]> <font face='Arial, Helvetica, sans-serif'><TABLE border=1 cellSpacing=2 cellPadding=2 width="100%"> <TBODY> <TR> <TD> <P align=justify><FONT color=#000000 size=3>Three local lenders, including BOC Hong Kong (2388), said yesterday they will raise mortgage rates for new home buyers by 50 basis points.<BR></FONT><FONT color=#000000 size=3><BR>It means new customers taking out a HK$1 million home loan will need to pay HK$5,000 more per year in interest. </FONT></P> <P align=justify><FONT color=#000000 size=3>BOC Hong Kong said interest rates on new home loans of HK$1.5 million or more will increase to prime minus 2 percent, equivalent to an interest rate of 3.25 percent, effective today. Rates on new home loans below HK$1.5 million will rise to prime minus 1.75 percent. </FONT></P> <P align=justify><FONT color=#000000 size=3>ICBC (Asia) (0349) also said it would raise its mortgage rates for new home buyers by 50 basis points, effective today. The new rate is prime minus 2.25 percent, or 3.25 percent. ICBC (Asia) director Stanley Wong Yuen-fai said he expects the number of new mortgage loans taken out in the fourth quarter to fall 10 percent when compared with the third quarter.<BR>&nbsp;<BR>Shanghai Commercial Bank said it will raise its mortgage rate for new customers effective immediately by 50 basis points, to prime minus 2.25 percent, equal to 3.25 percent. </FONT></P> <P align=justify><FONT color=#000000 size=3>CLSA said Hong Kong residential prices could plunge 20 percent over the next 15 months.</FONT></P> <P align=justify><FONT color=#000000 size=3>The high-end market could see a 30 percent drop in prices.</FONT></P> <P align=justify><FONT color=#000000 size=3>"We expect more speculators and investors to dump their holdings into the market," Citi analyst Tony Tsang said.</FONT></P> <P align=justify><FONT color=#000000 size=3>Prices of some units at Harbour Place in Hung Hom have already dropped 10 to 20 percent, property agents said.</FONT></P> <P align=justify><FONT color=#000000 size=3>"The problem is very serious," said Ricacorp head of research Patrick Chow Moon-kit. Transactions in the residential market will drop by 10 to 20 percent, Chow said. </FONT></P> <P align=justify><FONT color=#000000 size=3>Some property agents said developers may cut prices by 8 to 10 percent for new launches. Cheung Kong (Holdings) (0001) said yesterday it will cut prices of Seasons Monarch in Yuen Long by 2 percent for some customers for the first four days of the launch.</FONT></P> <P align=justify><FONT color=#000000 size=3>Hong Kong Property Services expects prices and rents of the four luxury projects atop Kowloon Station to drop 15 to 20 percent. <BR></P></FONT></TD></TR> <TR> <TD><EM><FONT color=#696969>News from the Standard</FONT></EM></TD></TR></TBODY></TABLE></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=262 2008-09-29 <![CDATA[Buyers call shots as flat prices fall]]> <font face='Arial, Helvetica, sans-serif'><TABLE border=1 cellSpacing=2 cellPadding=2 width="100%"> <TBODY> <TR> <TD> <P align=justify><FONT color=#000000 size=3>It was a bad weekend for the residential market as secondary-market prices fell by double-digit percentages after Hongkong and Shanghai Banking Corporation announced a plan to raise mortgage rates by 50 basis points effective today.<BR>"With the market staying lackluster and rates going up, owners have to cut prices by 5 percent to 8 percent to get buyers," said Centaline Property Agency executive director Chan Wing-kit.</FONT></P> <P align=justify><FONT color=#000000 size=3>Centaline said a Tsuen Wan Centre flat sold for HK$1 million after the owner settled for a 10 percent price cut.</FONT></P> <P align=justify><FONT color=#000000 size=3>Midland Realty said a Laguna Verde unit, listed at HK$5.2 million earlier this month, sold for HK$4.5 million yesterday, a 13 percent discount.</FONT></P> <P align=justify><FONT color=#000000 size=3>"Potential buyers are more aggressive in their bargaining and some have asked for 20 percent off," said Midland Realty chief analyst Buggle Lau Ka-fai. Secondary deals in the top 10 projects dipped in the past two days from 26 to 24, Ricacorp Properties managing director Willy Liu Wai-keung said. </FONT></P> <P align=justify><FONT color=#000000 size=3>About 10 percent of flat visits were canceled.</FONT></P> <P align=justify><FONT color=#000000 size=3>"The number of residential and non- residential deals in October, which reflects the situation in September, is expected to slump to 6,000, a 31-month low since January 2006," Lau said.</FONT></P> <P align=justify><FONT color=#000000 size=3>Secondary deals have softened since the middle of this month as the US financial tsunami rocks Hong Kong sentiment and takes its toll on job numbers at financial firms and related industries. </FONT></P> <P align=justify><FONT color=#000000 size=3>Lau expects the number of deals to increase 9.3 percent from 6,402 last month to 7,000 this month.</FONT></P> <P align=justify><FONT color=#000000 size=3>By Thursday, 6,149 deals were registered, a 20.5 percent rise over the same period last month while primary deals surged from 80 to 466 deals.<BR></FONT></P></TD></TR> <TR> <TD><EM><FONT color=#696969>News&nbsp;from the Standard</FONT></EM></TD></TR></TBODY></TABLE></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=261 2008-07-21 <![CDATA[Primary property market looks flat]]> <font face='Arial, Helvetica, sans-serif'><TABLE border=1 cellSpacing=2 cellPadding=2 width="100%"> <TBODY> <TR> <TD> <P align=justify><FONT color=#000000 size=3>Amid an anticipated shortage of new private housing, the primary property market will remain flat in the coming months, property agents said.<BR>On the weekend, only about 10 units were sold in the primary market. Among newly-launched projects, One Pacific Heights, built by Pacific Century Premium Development, recorded three sales.</FONT></P> <P align=justify><FONT color=#000000 size=3>According to data from the Transport and Housing Bureau, the number of private residential housing completed in the first six months was 1,600 units - a drop of 85 percent from 10,500 units the previous year - representing the lowest number of first-half completions since 1997. Meanwhile, private residential units that commenced construction during the first six months amounted to 1,100 units, down 91.5 percent from 12,900 units last year.</FONT></P> <P align=justify><FONT color=#000000 size=3>"The market may not react to the data in two months as investors are discreet if they have low investing intentions," said Jeffrey Ng, Midland Realty director for Hong Kong district. Ng added the Beijing Olympics next month may draw investors' attention away from the property market.</FONT></P> <P align=justify><FONT color=#000000 size=3>Wong Leung-sing, Centaline Property Agency associate director for research, said the quiet market is mainly due to the global volatility. He expects property prices to slightly adjust in the third quarter and rise slightly by the end of 2008. </FONT></P></TD></TR> <TR> <TD><EM><FONT color=#2f4f4f>News from the Standard</FONT></EM></TD></TR></TBODY></TABLE></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=260 2008-07-10 <![CDATA[Home prices on slippery slope]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>Mainland property prices will fall further because demand is weak and the government probably will not relax restrictions on home loans, says Citic Ka Wah Bank chief economist Liao Qun.<BR>"Policy targets with respect to the property market are still some way from being reached," Liao said in Shanghai. "The adjustment of the market is set to continue into 2009."</FONT></P> <P align=justify><FONT color=#000000 size=3>Policymakers have raised interest rates on mortgages for second homes and increased the minimum down payment to 40 percent of sale price last year, and in December the People's Bank of China ordered commercial banks to further tighten mortgage lending. Loan applications for the purchase of a second apartment are now counted by household instead of by individual.</FONT></P> <P align=justify><FONT color=#000000 size=3>Sales fell 0.4 percent to 136.6 million square meters in the first four months from 2007, says the National Development and Reform Commission. Prices in 70 major cities rose 9.2 percent in May, the smallest gain in eight months.</FONT></P> <P align=justify><FONT color=#000000 size=3>First-tier cities including Shenzhen, Beijing, Guangzhou and Shanghai will face more downward pressure on prices than smaller cities because of oversupply, according to Liao.</FONT></P> <P align=justify><FONT color=#000000 size=3>The economist expects home prices to fall a further 10 to 15 percent in Shenzhen, where average prices had already dropped 36.5 percent between October and May. House prices in Beijing and Shanghai may fall 10 percent over 12 months.</FONT></P> <P align=justify><FONT color=#000000 size=3>Falling home prices in Shenzhen and Beijing have raised concerns an asset-bubble burst may leave China's banks with more non-performing loans. The banking regulator warned lenders in May against a potential rebound in bad loans amid tighter credit controls and rising inflation. Property-related lending grew 30 percent annually in the past two years in China, twice as much as overall loan growth, according to Moody's Investors Service. </FONT></P> <P align=justify><FONT color=#000000 size=3>Liao does not expect financing rules to relax soon. "With excess liquidity still prevailing, the government would be concerned that an early relaxation of tightening measures would result in an undesired quick rebound in the market."</FONT></P> <P><EM><FONT color=#696969>News from the Standard</FONT></EM></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=259 2008-07-08 <![CDATA[Positive outlook on the home front]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>Prices in the secondary residential market remain firm, as Dr Check mentioned yesterday.<BR>For example, a unit in 31-year-old Taikoo Shing, quoted at HK$7,327 per square foot in January, rose to HK$7,638 psf at the end of last month.</FONT></P> <P align=justify><FONT color=#000000 size=3>Of course, some negative factors such as a bearish equities market and a burst housing bubble in the United States have seen the Hang Seng Index plunge 33 percent from its peak. Some homeowners are willing to reduce their selling prices by 3 percent to 5 percent.</FONT></P> <P align=justify><FONT color=#000000 size=3>But, as the Centa-City Leading Index shows, overall transaction prices remain high. The positive factors are:</FONT></P> <P align=justify><FONT color=#000000 size=3>Rents are rising because of inflation. Some analysts are expecting increases of about 30 percent in 2008 after last year's 20 percent hike. Residential rents are higher than the average monthly mortgage repayment in some areas.</FONT></P> <P align=justify><FONT color=#000000 size=3>Negative real interest rates still exist and room for a US rate rise is limited. Accordingly, Hong Kong rates are expected to stay near their historical lows.</FONT></P> <P align=justify><FONT color=#000000 size=3>The greenback has limited upside and the undervaluation of the HK dollar will be maintained under the peg.</FONT></P> <P align=justify><FONT color=#000000 size=3>The faltering stock market and low deposit interest rates may convince investors to buy property.</FONT></P> <P align=justify><FONT color=#000000 size=3>New private residential completions are expected to be at a "lower-than-expected" level of 10,980 units this year and 12,670 units in 2009. </FONT></P> <P align=justify><FONT color=#000000 size=3>Eleven years after 1997, most middle-class people have a steady income and can afford the downpayment to buy their own flats.</FONT></P> <P align=justify><FONT color=#000000 size=3>Dr Check and/or The Standard bear no responsibility for any investment decision made based on the views expressed in this column.</FONT></P> <P><EM><FONT color=#696969><STRONG>from Hong Kong Standard<BR></STRONG></FONT></EM></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=258 2007-10-29 <![CDATA[MTR extension triggers anxiety over rehousing]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>Residents of two Sai Ying Pun buildings that have to make way for the construction of the Mass Transit Railway's HK$8.9 billion West Island Line are worried about rehousing as they fear compensation to be offered will not be enough to buy new homes. <BR>They expressed their anxiety and frustration after attending a Lands Department forum yesterday.</FONT></P> <P align=justify><FONT color=#000000 size=3>More than 40 families in Tai Shing House and 2-4 Tsz Mi Alley will be forced to move out once Chief Executive Donald Tsang Yam-kuen and the Executive Council approve the bill to resume the buildings in 2009 to make way for Sai Ying Pun station.</FONT></P> <P align=justify><FONT color=#000000 size=3>Lands Department officials made unannounced visits to the residents on Friday - the day the government gazetted the resumption plan - to conduct surveys to stop non-residents being included in the compensation scheme.</FONT></P> <P align=justify><FONT color=#000000 size=3>"I didn't see it coming," said a Tai Shing House flat owner surnamed Lam. "They gave us two booklets and told us to attend this meeting two days later, but a lot of questions remain unanswered."</FONT></P> <P align=justify><FONT color=#000000 size=3>Many owners and tenants are worried the compensation will not be enough for new homes in the same area.</FONT></P> <P align=justify><FONT color=#000000 size=3>"Since rumors about the go-ahead for the West Island Line began half a year ago, rents for apartments the size of mine have soared from HK$4,500 to HK$7,000 a month," a tenant surnamed Lai said. </FONT></P> <P align=justify><FONT color=#000000 size=3>Government officials have told residents that public housing at New Shek Pai Wan Estate and interim housing in Aberdeen have been arranged for them, but they have to meet the income and asset requirements.</FONT></P> <P align=justify><FONT color=#000000 size=3>To qualify for public housing, the monthly income limit for a household of five is HK$16,900 while the limit for total net assets is HK$403,000.</FONT></P> <P align=justify><FONT color=#000000 size=3>Lam and her husband bought a 500-square-foot flat in 1997 for HK$1 million and have just finished paying off the mortgage. As the value of their assets disqualifies them from obtaining a public housing flat, Lam said she is worried they will be forced to buy a home at the peak of the housing market.</FONT></P> <P align=justify><FONT color=#000000 size=3>"We had made the same mistake before," Lam said.</FONT></P> <P align=justify><FONT color=#000000 size=3>Other home owners said officials are still unable to tell them when they will get their property values assessed and when exactly compensation will be paid. </FONT></P> <P align=justify><FONT color=#000000 size=3>Officials said there is an appeals mechanism for residents and shopowners if they are not happy with the arrangements. </FONT></P> <P align=justify><FONT color=#000000 size=3>However, many residents said they probably will not appeal.</FONT></P> <P align=justify><FONT color=#000000 size=3>"We're just powerless citizens. How can we fight the government?" Lai asked.</FONT></P> <P>News from the Standard</P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=257 2007-10-24 <![CDATA[MTR West Island Line Up-to-date]]> <font face='Arial, Helvetica, sans-serif'>The Mass Transit Railway's long- awaited West Island Line is to get an unprecedented HK$6 billion injection by the government - or two-thirds of the cost of the project that will link Sheung Wan with Kennedy Town by 2016. <P align=justify><FONT color=#000000 size=3>The cash subsidy for the profit- making company to proceed with the HK$8.9 billion line is the first of its kind by the administration which, in the past, has relied on granting property development rights to bridge funding gaps in railway projects.</FONT></P> <P align=justify><FONT color=#000000 size=3>Secretary for Transport and Housing Eva Cheng Yu-wah said yesterday the project will significantly improve congested traffic conditions, revitalize the aging district and generate economic returns.</FONT></P> <P align=justify><FONT color=#000000 size=3>The 3km West Island Line will benefit an estimated 140,000 residents and 60,000 workers in the district in 2016, saving them 12 million hours on transport - equivalent to saving HK$44 billion in 40 years. A trip from Kennedy Town to Sheung Wan during rush hour will be reduced from 25 minutes at present to less than eight minutes.</FONT></P> <P align=justify><FONT color=#000000 size=3>The project will also create 2,800 jobs during the construction period from 2009 to 2014, and a further 2,000 jobs upon completion.</FONT></P> <P align=justify><FONT color=#000000 size=3>Cheng said the subsidy is also justified in that MTR Corp will not be able to generate project funding from fare revenues alone or develop property in the crowded district.</FONT></P> <P align=justify><FONT color=#000000 size=3>According to a government source, the existing 1.9-hectare Kennedy Town swimming pool - the only potential land for property development in the district - is too small to generat <BR>e revenue to bridge the funding gap.</FONT></P> <P align=justify><FONT color=#000000 size=3>Other potential sites such as the police dormitory on Ka Wai Man Road are too far from the designated MTR exits. </FONT></P> <P align=justify><FONT color=#000000 size=3>MTRC acting chief executive Lincoln Leong Kwok-kuen blamed the higher than projected costs on the investment the project involved. </FONT></P> <P align=justify><FONT color=#000000 size=3>"The high investment cost comes from building more station exits, more elevators for the disabled, a two-kilometer underground walkway, using environmentally friendly construction methods, and relocating two district facilities to other areas," he said.</FONT></P> <P align=justify><FONT color=#000000 size=3>The subsidy will be given in two stages, with HK$400 million in the first covering design-phase expenditure. </FONT></P> <P align=justify><FONT color=#000000 size=3>The line, long approved by Central and Western District Council, finally materialized with the Executive Council giving the green light yesterday. </FONT></P> <P align=justify><FONT color=#000000 size=3>With funding approval from legislators already obtained, construction will begin in 2009 and is due to be completed by 2014. </FONT></P> <P align=justify><FONT color=#000000 size=3>It will be an extension of the Island Line from Sheung Wan - with three new stations at Sai Ying Pun, University and Kennedy Town.</FONT></P> <P align=justify><FONT color=#000000 size=3>The line works will also see the David Trench Rehabilitation Centre on Bonham Street relocated to the upper level police station on High Street, and Kennedy Town Swimming Pool moved to Kennedy Town Praya.</FONT></P> <P align=justify><FONT color=#000000 size=3>Centaline Surveyors managing director Victor Lai Kin-fai said the line will revitalize the old district.</FONT></P> <P align=justify><FONT color=#000000 size=3>Midland Surveyors director Alvin Lam Tsz-pun said Kennedy Town will attract more developers to redevelop. </FONT></P> <P>News from the Standard</P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=256 2007-10-10 <![CDATA[Sales in secondary market surge on limited new supply Proposed revival of subsidized housing fails to hurt mood]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>Defying concerns over the resumption of building flats under the Home Ownership Scheme (HOS), transactions of second-hand homes continue to grow, according to estate agents. </FONT></P> <P align=justify><FONT color=#000000 size=3>Amid limited new supply and increased demand, a total of 561 purchases of second-hand homes at 50 major housing estates were reported from October 1 to 7, according to Ricacorp Properties. </FONT></P> <P align=justify><FONT color=#000000 size=3>This represented a 19 per cent rise from the previous week, it said. <BR>Midland Realty also reported a rising trend in the secondary market, with 335 deals recorded at 35 housing estates, the highest number of transactions in a week so far this year. </FONT></P> <P align=justify><FONT color=#000000 size=3>Hong Kong Property chief executive Fredy Wu said the proposed resumption of government-subsidised housing under the Home Ownership Scheme did not bring any impact on buying sentiment. </FONT></P> <P align=justify><FONT color=#000000 size=3>Some members of the Housing Authority, which advises the administration on public housing policies, are pushing for the relaunch of the authority's Home Ownership Scheme to build affordable accommodation for the less well-off. </FONT></P> <P align=justify><FONT color=#000000 size=3>Up to 5,000 flats were proposed to be launched, Mr Lau said. </FONT></P> <P align=justify><FONT color=#000000 size=3>The number was insignificant in a bull market, said Midland Realty chief analyst Buggle Lau Ka-fai. </FONT></P> <P align=justify><FONT color=#000000 size=3>Agents said the positive performance in the secondary market was helped by buyers' growing confidence in the housing market, spurred by such factors as cheap mortgage, sound economy and low unemployment rate. </FONT></P> <P align=justify><FONT color=#000000 size=3>Mr Lau said the limited supply of new flats also pushed homebuyers to the secondary market. </FONT></P> <P align=justify><FONT color=#000000 size=3>At least seven large-scale residential developments will start offering a total of about 10,000 flats before the end of the year. </FONT></P> <P align=justify><FONT color=#000000 size=3>Add to these big-scale launches a number of smaller developments coming to the market as well as relaunches of unsold flats, and the number of units available for sale could reach more than 15,000 units, according to Midland Realty. </FONT></P> <P align=justify><FONT color=#000000 size=3>These include the first phase of Dream City, now known as Lohas Park Phase One, in Tseung Kwan O, and an 800-unit upmarket development, the Cullinan at Kowloon Station, which is jointly developed by Sun Hung Kai Properties (SEHK: 0016) and MTR Corp. </FONT></P> <P align=justify><FONT color=#000000 size=3>SHKP and New World Development's 2,470-unit Hung Hom Peninsula project in Hung Hom, now known as Harbour Place, is also expected to be launched in the last quarter. </FONT></P> <P align=justify><FONT color=#000000 size=3>So far no major projects have been launched. </FONT></P> <P align=justify><FONT color=#000000 size=3>With the continued rise in transaction volumes, the number of deals this month, which will be announced by the Land Registry in early November, could exceed 10,000, Mr Lau said. </FONT></P> <P align=justify><FONT color=#000000 size=3>The best performance so far this year was recorded in July, with purchases of more than 10,000 units in the secondary market. </FONT></P> <P align=justify><FONT color=#000000 size=3>Mr Lau expects the number of transactions to reach 95,000 for the whole of the year, the second-highest total after 1997 when the market peaked. </FONT></P> <P><EM>News from the SCMP.com</EM></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=255 2007-09-07 <![CDATA[Developers seek auction options]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy>While some developers eager to replenish their land banks amid a thriving economic recovery seek to trigger auctions of government land, others are looking at cheaper alternatives. <P>The sizes and prices of recently auctioned sites see them moving out of reach of some low-tier to mid-tier developers. <P>The government has reaped HK$15.28 billion from five land sales this financial year, meaning that each plot cost HK$3.06 billion on average. <P>And with aggressive bidding at auctions, the cost of "flour" - the plot to be developed - is nearing the price of "bread" - the completed building. <P>For example, the Wong Tai Sin site that went under the hammer on July 31 sold for HK$3.98 billion, or HK$4,324 per square foot. Galaxia, the leading estate in the district, is selling for about HK$4,500 psf. <P> <TABLE border=0 cellSpacing=0 cellPadding=9 width=250 align=right valign="top"> <TBODY> <TR> <TD> <CENTER><FONT color=grey size=1>ADVERTISEMENT</FONT></CENTER><BR> <SCRIPT type=text/javascript><!--//<![CDATA[ document.MAX_ct0 ='%c'; var m3_u = (location.protocol=='https:'?'https://203.80.0.221/openx-2.6.4/www/delivery/ajs.php':'http://203.80.0.221/openx-2.6.4/www/delivery/ajs.php'); var m3_r = Math.floor(Math.random()*99999999999); if (!document.MAX_used) document.MAX_used = ','; document.write ("<scr"+"ipt type='text/javascript' src='"+m3_u); document.write ("?zoneid=4&amp;target=_blank&amp;withtext=1&amp;block=1"); document.write ('&amp;cb=' + m3_r); if (document.MAX_used != ',') document.write ("&amp;exclude=" + document.MAX_used); document.write (document.charset ? '&amp;charset='+document.charset : (document.characterSet ? 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But this process can take up to a decade as developers wait for individual owners to sell their units. <P>"Some homeowners tend to be stubborn about the money they feel they deserve," Lai said. Others are just not prepared to move after living in the same flat for years, or demand huge compensation from developers. <P>Older buildings usually have not used up their permitted plot ratio, which is the main reason property firms are interested in redeveloping them - to gain a higher profit margin by building more flats without paying a land premium. <P>While such acquisitions were at a peak in the 1990s, a law has been passed to speed up acquisitions. The Land (Compulsory Sale for Redevelopment) Ordinance, in force since June 1999, allows a developer to force an auction for the sale of outstanding units after securing at least 90 percent ownership. The buildings themselves must be at least 40 years old. <P>On August 4, property-to-hotel conglomerate Emperor International Holdings (0163), controlled by tycoon Albert Yeung Sau-shing, acquired the remaining interests of 9A to 9H Seymour Road, a Mid-Levels luxury residential project, for HK$464 million at auction. The group held 97 percent ownership of the site before the auction. <P>So far, the law has been applied 10 times. <P>"Unless necessary, developers tend not to use the law as the process of approval takes a long time and tedious paperwork," Lai said, adding that developers generally prefer to pay more for properties rather than force auctions. <P>Individual homeowners can also appoint surveyors to sell their units collectively. The 52-year-old Wah Yuen building in Nga Tsin Wai Road, Kowloon Tong, is up for sale by tender. The site has a gross floor area of 36,000 sqft, and is expected to fetch HK$200 million. <P>Still in the luxury area in Kowloon, owners representing a 94 percent interest in the 50-year-old Kelvin Garden building in Grampian Road have put it up for tender with a target of about HK$230 million. Other possible collective sales include 211 to 215C Prince Edward Road West and a building at 250 to 252 Sai Yeung Choi Street in Mong Kok, which are valued at HK$200 million and HK$230 million respectively. <P>There were 20 sites put up for collective sale by tender in 2006, up 43 percent on the 14 rolled out in 2005. <P>Of the 20 sites, 15 were originally residential, four were industrial sites and one commercial. <P>While land sold annually at auction is worth billions, the cost of each collective sale is usually about HK$200 million to HK$800 million. <P>Over the past years, private acquisitions of various kinds have been virtually confined to Hong Kong Island and Kowloon as the housing supply in urban areas continues to stay tight. <P>Government data implies that there will be a dearth of primary properties as the number of new units under construction is a mere 700, down 36 percent from the first quarter, or plunging 82.9 percent compared with the second quarter last year. <P>Of the 215,405 square meters of residential land for sale in the application list, over half is in the New Territories, 31 percent on the Island and 17 percent in Kowloon. <P>Among 25 attempts to trigger land for auction this year, only one was on the Island. The Aberdeen site was triggered for sale on August 31 with a bid of HK$2.5 billion, or almost HK$3,900 psf. <P>An interesting phenomenon is that although there is no shortage of luxury application list sites available on the Island, nobody seems to want to touch them, Lai said. <P>He said large developers probably know that demand for traditional luxury sites will lead to a high premium during auctions, so they prefer to join the race for mid-tier sites and hunt for older buildings in luxury areas. <P>In response to developers' calls, authorities are considering relaxing the conditions which allow for a forced auction of an existing residential complex, by lowering the requirement governing a developer's holding interest in a site from 90 percent to 80 percent. <P>Lai said that will speed up acquisitions for redevelopment. <P> <P><FONT size=2>from The Standard</FONT></SPAN></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=292 2007-07-13 <![CDATA[Tall tale of two centers]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>The real estate market is rife with stories that Sun Hung Kai Properties has managed to snare one or two major financial names to act as the critical anchor tenants for its soaring International Commerce Centre development, which is appearing out of the ground adjacent to Kowloon Station. </FONT></P> <P align=justify><FONT color=#000000 size=3>This entire development will provide 5.5 million square feet and will house offices, hotels, serviced apartments and retail space, with its tallest tower, at 118 floors, dwarfing the existing International Finance Centre on the waterfront in Central. </FONT></P> <P align=justify><FONT color=#000000 size=3>If the stories of the relocations of some leading investment banks away from the cramped confines of Central are correct, it is good news indeed for Hong Kong, as it will be the first time in more than 160 years that the real commercial hub of Hong Kong has shown signs of dispersing. </FONT></P> <P align=justify><FONT color=#000000 size=3>The advantage of being able to find large amounts of space at reasonable rents in buildings that have large floor plates, and which are equipped with a more-than-ample electricity supply, has already lured financial firms to the mid- town area in New York and Canary Wharf in London. </FONT></P> <P align=justify><FONT color=#000000 size=3>Although it is true that it was the government-controlled Town Planning Board that gave permission for the office space on that site across in Kowloon to be built, it is not obvious that this development was at any stage intended to be the sapling from which a new and vibrant financial center might grow. </FONT></P> <P align=justify><FONT color=#000000 size=3>The ICC site has excellent communications, both road and rail, especially on its north and south axis, while connections will only be enhanced when the terminal for the express rail service to the mainland is completed on an adjacent site in a couple of years. </FONT></P> <P align=justify><FONT color=#000000 size=3>The development over the terminus will give rise to a significant amount of additional office space, enhancing the hub effect of ICC, while to the south of the site you also have the huge, but still bare, reclaimed land that has been the subject of the whole West Kowloon cultural district debate. </FONT></P> <P align=justify><FONT color=#000000 size=3>The rise of West Kowloon as a new financial hub will be the market's answer to the technical deficiencies of the aging Hong Kong Island central office stock, while also representing an opportunity for these companies to save a lot in rent. </FONT></P> <P align=justify><FONT color=#000000 size=3>In short, the rise of the West Kowloon office market as a center for high- end financial services companies is a reaction to market forces and, rather than try to inhibit these trends, our planners should be facilitating the development of this second commercial center. </FONT></P> <P align=justify><FONT color=#000000 size=3>In practical terms what this means is that the administration's planners must make sufficient office sites available in and around the West Kowloon area over the next few years to ensure that we get a significant number of high- specification buildings capable of providing world-class space at reasonable rents, with the leading international firms being, for the first time in Hong Kong, able to contemplate having their own buildings. </FONT></P> <P align=justify><FONT color=#000000 size=3>Grabbing hold of this relocation trend, we need to ensure that we have the right infrastructure for our growth as a financial center and we need to accept the benefits of a bipolar development model using both West Kowloon and Central as hubs. </FONT></P> <P align=justify><FONT color=#000000 size=3>The moment that a two-center development model is accepted, with Kowloon and Central enhancing each other, the need for the proposed huge low-rise buildings on the Central reclamation falls away, and the space could then be developed to much lower densities, densities that actually enhance the vibrancy of Central. </FONT></P> <P align=justify><FONT color=#000000 size=3>Equally, once one accepts that the West Kowloon cultural district can be for mixed use, emphasizing offices and cultural facilities, in a relatively low- rise campus-style setting, a vibrant and much more benign urban environment can be envisaged on both sides of the harbor. </FONT></P> <P align=justify><FONT color=#000000 size=3>Although the original plot ratio for the West Kowloon site suggested under the Foster plan for the cultural district was a little under two times site coverage, it is believed that the developers that tendered for the original development felt that up to double that amount of space, or 14 million square feet, could be readily built there while keeping a campus ambience. </FONT></P> <P align=justify><FONT color=#000000 size=3>Thus we have the space available to really make a difference to the quality of life in Hong Kong, but the challenge to planners is to recognize what is happening in the market and to be smart and quick enough to latch on to the trend. </FONT></P> <P align=justify><FONT color=#000000 size=3>Accepting this dual-center development model, and adopting a distributed approach to locating cultural centers, as Swire earlier suggested, will damage some vested interests, but not heeding the market will do even greater damage to Hong Kong as a financial center. </FONT></P> <P align=justify><FONT color=#000000 size=3>The market is presenting our planners with a golden opportunity to throw away decades-old thinking. Whether they can throw off their shackles as readily as some investment banks can is, of course, another matter.</FONT></P> <P>News from the Standard</P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=254 2007-07-05 <![CDATA[Resident fails in bid to block `great wall' job]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>The High Court has rejected a judicial review application by a Sham Shui Po resident seeking to halt the construction of "wall buildings" on a West Kowloon site, saying his challenge was not sufficiently precise and was late. </FONT></P> <P align=justify><FONT color=#000000 size=3>While sympathizing with the plight of Ng Ngau-chai, 73, the court said Wednesday it could only deal with law and that matters of the environment were up to the executive. </FONT></P> <P align=justify><FONT color=#000000 size=3>Ng sought a review of the Town Planning Board and Planning Department's decision to designate the site on Hoi Fai Road - regarded as the last "ventilation window" for Tai Kok Tsui - for residential use without any height restriction. </FONT></P> <P align=justify><FONT color=#000000 size=3>Ng claimed the decision "was made in breach of the statutory duty to properly follow the Town Planning Urban Design Guidelines and the spirit of the Town Planning Ordinance, by selective adoption of such guidelines without reasonable and objective standard and consistence." </FONT></P> <P align=justify><FONT color=#000000 size=3>Ng accused the government of going ahead with the decision despite an objection from the Yau Tsim Mong District Council, and that this could result in a deteriorating living environment with blocked ventilation and views as well as reduced public open spaces. </FONT></P> <P align=justify><FONT color=#000000 size=3>But High Court Judge Anselmo Reyes said Ng did not identify the particular regulations he was accusing the government of flouting. </FONT></P> <P align=justify><FONT color=#000000 size=3>It was not enough to state that some provisions have been ignored without detailing what they state. </FONT></P> <P align=justify><FONT color=#000000 size=3>Without specific information the court could not proceed with the review, Reyes said. <BR>Moreover, judicial reviews should be made within three months of a given decision. <BR>But Ng's challenge, which was believed to be against a decision made by the Town Planning Board's Metro Planning Committee in 2005, was delayed for more than two years and no reason was provided for the delay. </FONT></P> <P align=justify><FONT color=#000000 size=3>Reyes said he fully sympathized with Ng's concerns about the deteriorating quality of the environment around Tai Kok Tsui, where Ng lives. </FONT></P> <P align=justify><FONT color=#000000 size=3>"But the court can only apply the law," Reyes said. "The Judiciary cannot manage the environment. This is the role of the executive. There is a limit to what can be done through the court by way of judicial review." </FONT></P> <P align=justify><FONT color=#000000 size=3>Outside court, Ng said the government did not care about people's lives and the buildings lining the West Kowloon seafront were like a "great wall," blocking wind and affecting the health of residents. </FONT></P> <P align=justify><FONT color=#000000 size=3>Lam Ho-yeung, the Democratic Party Yau Tsim Mong district councillor who helped Ng in the legal application, said concern group Green Sense will continue to scrutinize other sites. </FONT></P> <P align=justify><FONT color=#000000 size=3>Ng's writ was filed on June 11, one day before the auction of the site for HK$5.56 billion, won by Sun Hung Kai Properties. </FONT></P> <P align=justify><FONT color=#000000 size=3>The same site at Hoi Fai Road faces another challenge by Green Sense, which has asked the Town Planning Board to reduce the residential plot ratio and to create a 10-meter-wide ventilation corridor at the north of the site. </FONT></P> <P align=justify><FONT color=#000000 size=3>The board will process the group's submission on August 24. </FONT></P> <P>News from the Standard</P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=253 2007-06-08 <![CDATA[Waterfront site may fetch $6.2b]]> <font face='Arial, Helvetica, sans-serif'>All eyes are on next week's auction of a waterfront residential site in West Kowloon which analysts expect to go as high as HK$6.2 billion. <P align=justify><FONT color=#000000 size=3>The sale of the prime Hoi Fai Road site is expected to provide a positive impetus to the luxury residential property market in the district. </FONT></P> <P align=justify><FONT color=#000000 size=3>CB Richard Ellis' executive director of valuation and advisory services in Asia, Yu Kam-hung, reckons the site will sell for HK$5.8 billion, or HK$6,338 per square foot. </FONT></P> <P align=justify><FONT color=#000000 size=3>Developers, who took a cautious stance at last month's auction of a smaller site in West Kowloon, may be holding on to their cash to bid for the bigger site on Hoi Fai Road in the same area at the auction Tuesday, market watchers said. </FONT></P> <P align=justify><FONT color=#000000 size=3>Last month's auction saw a consortium comprising Sino Land (0083), Chinese Estates Holdings (0127), K Wah International (0173) and Nan Fung Development secure a residential plot at Hoi Wang Road in West Kowloon for HK$4 billion, which was at the low end of market estimates of between HK$4 billion and HK$5 billion. </FONT></P> <P align=justify><FONT color=#000000 size=3>The low-end price prompted Vigers Appraisal and Consulting executive director Tony Chan Tung-ngok to lower his valuation for the Hoi Fai Road site by 11.4 percent to HK$6.2 billion, or HK$6,767 psf. </FONT></P> <P align=justify><FONT color=#000000 size=3>"If companies partner up, fewer bidders will take part, which may affect the final price," he said. </FONT></P> <P align=justify><FONT color=#000000 size=3>That is despite the fact that the sea views from the Hoi Fai Road site are a little better than from the one sold last month, he added. </FONT></P> <P align=justify><FONT color=#000000 size=3>Charles Chan Chiu-kwok, managing director of valuation and professional services at property consultant Savills, said the site could go for nearly HK$6.1 billion, or HK$6,650 psf. </FONT></P> <P align=justify><FONT color=#000000 size=3>Centaline Surveyors director James Cheung King-tat expects the site to sell for nearly HK$6,800 psf. </FONT></P> <P align=justify><FONT color=#000000 size=3>Midland Surveyors director Alvin Lam Tsz- pun believes the site is worth HK$6 billion because it is close to Olympic station and some units will have sea views. "It is one of the few waterfront sites in the area," Lam said. </FONT></P> <P align=justify><FONT color=#000000 size=3>The Hoi Fai Road auction was triggered by Wheelock Properties (0049) with a bid of HK$4.2 billion, the biggest by a developer since 2004. </FONT></P> <P align=justify><FONT color=#000000 size=3>The 122,204 sq ft site adjacent to One SilverSea - which was developed by Sino Land - is likely to draw bids from rival developers. </FONT></P> <P align=justify><FONT color=#000000 size=3>Those include Cheung Kong (Holdings) (0001), Sun Hung Kai Properties (0016), Sino Land and K Wah, which have all indicated interest in the site. </FONT></P> <P align=justify><FONT color=#000000 size=3>Yu of CB Richard Ellis agreed Sino Land would be aggressive in bidding for the site. <BR>The bid of HK$4.2 billion, or HK$4,583 psf, will also be the opening bid. </FONT></P> <P align=justify><FONT color=#000000 size=3>Wheelock director Ricky Wong Kwong-yiu said the Hoi Fai Road site would accommodate construction of between 800 and 900 flats of more than 1,000 sq ft each. The project will have a potential total floor area of 916,522 sq ft. </FONT></P> <P align=justify><FONT color=#000000 size=3>He estimates the outlay, including land price, construction cost and other fees, will be between HK$7 billion and HK$8 billion. </FONT></P> <P align=justify><FONT color=#000000 size=3>Wheelock would also consider joining forces with other developers to bid for the site given the large scale of the project, he added. </FONT></P> <P align=justify><FONT color=#000000 size=3>Sino bought the One SilverSea development site for HK$1.6 billion, or HK$1,944 psf, at a government land auction in 2002 when the market was in a downturn. </FONT></P> <P align=justify><FONT color=#000000 size=3>Cheung Kong executive director Justin Chiu Kwok-hung said: "At the Hoi Fai site, the [existing] flats are newer and so [the owners] won't upgrade soon. Still, the views [from the plot up for auction] are better." </FONT></P> <P align=justify><FONT color=#000000 size=3>Chiu confirmed Cheung Kong is interested in the site. </FONT></P> <P align=justify><FONT color=#000000 size=3>In September 2004, a residential site on Tin Kwong Road in Ho Man Tin was triggered for auction with a bid of HK$5.02 billion. </FONT></P> <P align=justify><FONT color=#000000 size=3>The site was sold to Cheung Kong for HK$9.42 billion a month later. </FONT></P> <P align=justify><FONT color=#000000 size=3>In September 2005, two adjoining sites opposite Hoi Fu Court and Park Avenue in West Kowloon fetched between HK$5,300 psf and HK$5,400 psf. A consortium involving Sino Land, Nan Fung and Chinese Estates won those sites. </FONT></P> <P align=justify><FONT color=#000000 size=3><FONT color=#a9a9a9 size=2><EM>News from the Standard</EM></FONT><BR></P></FONT><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=252 2007-05-25 <![CDATA[QDII a likely market spur]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000>Recent policy changes to the QDII scheme allowing qualified domestic institutional investors in the mainland to invest in overseas investment exchanges are likely to have a positive impact on Hong Kong's property market, an analyst says.<BR>The China Banking Regulatory Commission earlier this month unveiled its long- awaited plan to widen the investment scope of the QDII scheme to also cover equities and structured products.</FONT></P> <P align=justify><FONT color=#000000>The move will allow commercial banks and funds to buy overseas stocks in an effort to encourage more fund outflows and ease the excess liquidity which has sent the domestic stock market to new highs.</FONT></P> <P align=justify><FONT color=#000000>Eric Wong, co-head of Asia real estate research at UBS, said in addition to increasing "depth and breadth" of demand for Hong Kong stocks and other investment products, the move will also increase demand for office space as QDII managers will have to shift to Hong Kong to oversee the market.</FONT></P> <P align=justify><FONT color=#000000>He said the move has opened the door for China to further expand the quota, but it is hard to say whether Beijing will do that now as it depends on how successful the new QDII rules are in attracting investment.</FONT></P> <P align=justify><FONT color=#000000>"Strong fundamentals such as low mortgage rates, low land supply and real interest rates turning negative in Hong Kong will prompt an increase in value of both Hong Kong property and property stocks," said Wong, who maintains his forecast that housing prices in the SAR will rise by 30 percent this year.</FONT></P> <P align=justify><FONT color=#000000>Analysts said expected housing demand from QDII managers is also likely to help boost the luxury residential market.</FONT></P> <P align=justify><FONT color=#000000>Real estate consultancy firm Knight Frank has revised the rental growth forecasts for luxury apartments this year from 5-8 percent to 12-15 percent.</FONT></P> <P align=justify><FONT color=#000000>Vacancy rates of many residential blocks in traditional luxury residential districts such as The Peak, Island South and Mid-Levels have dropped to below 4 percent. </FONT></P> <P align=justify><FONT color=#000000>This has led to a greater-than-expected rental increase of 4 percent in the first four months of this year against the end of last year, Knight Frank said.</FONT></P> <P align=justify><FONT color=#000000>Rental growth of luxury residential properties is set to accelerate when the peak season for new expatriate arrivals begins in the summer.</FONT></P> <P align=justify><FONT color=#000000>Knight Frank has also upwardly revised its rental growth forecasts for Grade A offices for 2007, due to a faster-than-expected influx of Chinese and multinational corporations as well as a robust domestic economy.</FONT></P> <P align=justify><FONT color=#000000>Demand for prestigious office space in Central continues to be strong, with limited stock available in the premium Grade A buildings such as IFC, Cheung Kong Center, Chater House and AIG Tower, said Andrew Ness, executive director of CBRE Research, Asia.</FONT></P> <P align=justify><FONT color=#000000>As a result of the persistent demand, especially from banking and hedge fund tenants, Central has witnessed rapid rental growth. A prime example is the 5,000-square-foot new letting on level 67 of Two IFC to a hedge fund at a net effective rent of HK$170 per square foot, a record high for the Hong Kong market.</FONT></P> <P align=justify><FONT color=#000000>Belgian bank Fortis is committed to leasing three floors totaling 30,000 sqft in Three Exchange Square as part of its expansion strategy. </FONT></P> <P align=justify><FONT color=#000000>Meanwhile, Lehman Brothers has secured expansion space of 23,000 sqft and 10,000 sqft in Two IFC and Man Yee Building respectively.</FONT></P> <P align=justify><FONT color=#000000>Other new lettings include US legal firms Fried Frank - 18,500 sqft in Gloucester Tower - and White &amp; Case, who have leased three entire floors totaling 22,500 sqft in Central Tower.</FONT></P> <P align=justify><FONT color=#000000>In other Hong Kong Island office submarkets, leasing activity is comparatively quiet, Ness said.</FONT></P> <P align=justify><FONT color=#000000>Competition among Causeway Bay landlords heightened as vacancies rose in some buildings. Some tenants are making tentative plans to move to new buildings soon be launched in the market, such as International Commerce Centre at Kowloon Station and One Island East in Quarry Bay.</FONT></P> <P align=justify><FONT color=#000000>Sources said Credit Suisse and Morgan Stanley are in discussions to lease ICC.</FONT></P> <P align=justify><FONT color=#000000>The leasing negotiations for the first phase of ICC, with an expected occupation permit date in December 2007, have reached the advanced stage, predominantly with Hong Kong Island occupiers, Ness said.</FONT></P> <P align=justify><FONT color=#000000>While ICC is expected to alleviate the current shortage of CBD office space, it has yet to produce adverse pressure on rentals in Central that have shown no signs of declining, he added.</FONT></P> <P align=justify><FONT color=#000000>He said the imminent supply of several quality buildings in East Kowloon, particularly in Kwun Tong and Kowloon Bay, is providing viable cost effective opportunities to tenants on Hong Kong Island, which will place downward pressure on rents in decentralized districts as 2007 progresses.</FONT></P> <P align=justify><FONT color=#000000>In Tsim Sha Tsui, vacancies of Miramar Tower dropped significantly in the first quarter after the landlords, Miramar Group and Henderson Land Development (0012), took up about 50,000 sqft.</FONT></P> <P align=justify><FONT color=#000000>However, vacancies at The Gateway in the district will increase after the relocation of Sears Holdings Global Sourcing.</FONT></P> <P align=justify><FONT color=#000000>With an eye to rental savings and the need for consolidation after merger and acquisition activity, Sears has decided to relocate its operations from Admiralty and Tsim Sha Tsui to Langham Place in Mong Kok, occupying more than 120,000 sqft on seven floors.</FONT></P> <P>News from the Standard</P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=251 2007-05-15 <![CDATA[Rents set to triple at Citibank Plaza]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>Champion REIT (2778), which earns income from Citibank Plaza, expects rents for the Grade-A office building in Central to more than triple when tenants renew leases this year.<BR></FONT></P> <P align=justify><FONT color=#000000 size=3>The real estate investment trust is poised to reap the rewards of rising office rents as discounted leases of more than HK$20 per square foot in monthly rent signed during lean times a few years ago come up for renewal. </FONT></P> <P align=justify><FONT color=#000000 size=3>Rents have breached the HK$80 mark at Citibank Plaza, Champion REIT chairman Lo Ka-shui said Monday after the trust's first annual general meeting since listing last May.</FONT></P> <P align=justify><FONT color=#000000 size=3>Rents have also exceeded a forecast of HK$71.48 psf made at its initial public offering. </FONT></P> <P align=justify><FONT color=#000000 size=3>Lo said occupancy in Citibank Plaza was about 96 percent. </FONT></P> <P align=justify><FONT color=#000000 size=3>"Prospects for the year are promising - more than 50 percent of the space in Citibank Plaza is due for a rental reversion or renewal at a time when vacancies are expected to remain low and rents are rising," he said. But the rate of office rental increase in the financial hub may slow after strong gains in recent years, he said.</FONT></P> <P align=justify><FONT color=#000000 size=3>Meanwhile, commercial landlord Swire Properties said there was robust demand from banking and finance institutions for space in prime business locations. Swire announced the recent signing of two office leases in Pacific Place in Admiralty, increasing the building's occupancy to near 100 percent.</FONT></P> <P align=justify><FONT color=#000000 size=3>Average effective rents for One and Two Pacific Place stand at a high HK$70s psf and for Three Pacific Place at mid HK$60s psf, Swire said.</FONT></P> <P align=justify><FONT color=#000000 size=3>Natixis, a Europe-based international investment bank, expanded its Hong Kong office in Two Pacific Place to more than 40,000 sq ft. </FONT></P> <P align=justify><FONT color=#000000 size=3>Hong Kong Monetary Authority is also taking up more than 27,000 sq ft in One Pacific Place to meet the expansion of its World Bank Occupier-International Finance Corp office. </FONT></P> <P align=justify><FONT color=#000000 size=3>They are among many banking and finance institutions that have leased office space in Pacific Place for their operations, Swire said.</FONT></P> <P align=justify><FONT color=#000000 size=3>"We see sustained strong demand from investment banking, insurance and finance sectors for quality office space in prime areas and, indeed, we continue to receive expansion requests from existing tenants," said Jolyon Culbertson, director and general manager of Swire Properties. </FONT></P> <P align=justify><FONT color=#000000 size=3>"With the tight supply of grade-A offices in the central business district, the rent of Pacific Place offices is expected to stay firm."</FONT></P> <P>News from the Standard</P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=250 2007-05-11 <![CDATA[Market to record steady growth]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy><FONT color=#000000 size=3>With strong economic fundamentals, a buoyant labor market, rising incomes and the impetus stemming from the generous offerings in the 2007-08 budget, the property market in Hong Kong as a whole recorded steady growth in the first quarter. </FONT> <P align=justify><FONT color=#000000 size=3>Demand in the Hong Kong Grade A office market continued to benefit from corporate expansions despite moderate economic growth through the latter part of 2006, and anecdotal evidence suggested that this momentum continued into the first quarter. </FONT> <P align=justify><FONT color=#000000 size=3>While banking, finance and legal services companies continued to expand in Central, the market likewise saw a steady level of expansion across the other markets. </FONT> <P align=justify><FONT color=#000000 size=3>Meanwhile, cost-sensitive tenants continued to relocate to non-core markets like Kowloon East and to non- Grade A offices within core areas. </FONT> <P align=justify><FONT color=#000000 size=3>With the exception of Hong Kong East, all office sub-markets recorded a positive net take-up in the first quarter. Overall net take-up amounted to about 342,000 square feet, slightly higher than that in the fourth quarter of 2006. </FONT> <P align=justify><FONT color=#000000 size=3>On the supply side, no new Grade A office project was completed in the first quarter after the delay of 633 King's Road's completion until the second quarter. </FONT> <P align=justify><FONT color=#000000 size=3>With the absence of new supply and the strong leasing activity in Central and the Kowloon non-core office sub- markets, overall vacancy decreased from 5.4 percent to 5 percent at the end of the first quarter. </FONT> <P align=justify><FONT color=#000000 size=3>The investment market was highlighted by the whole-block purchase of three adjoining non-Grade A office buildings in Sheung Wan by Citigroup Property Investors for about HK$1.5 billion. It is reported that the three sites will be amalgamated and redeveloped into Grade A offices. </FONT> <P align=justify><FONT color=#000000 size=3>During the first quarter, overall average net effective rental for Grade A offices rose by 2.8 percent quarter on quarter while overall average capital value increased by 2.3 percent. </FONT> <P align=justify><FONT color=#000000 size=3>In the retail property market, growing incomes stemming from rising salaries and bonus payments contributed to a higher level of domestic demand. The retail market continued to register robust growth in the first quarter, with retail sales increasing by 11.4 percent year on year during the January-February period. The various tax benefits proposed in the 2007-08 budget are set to benefit the consumption market. In the long run, the tax cut will raise the disposable income of taxpaying households by 23 percent. This will in turn induce further spending. </FONT> <P align=justify><FONT color=#000000 size=3>With the strengthening consumer confidence, the market saw stronger expansion demand for prime retail properties in major shopping districts from brand-name retailers throughout the quarter. These retailers are generally those with wider profit margins and stronger financial positions to bear rising rental costs. </FONT> <P align=justify><FONT color=#000000 size=3>The renovation of Crawford House (formerly Lane Crawford House) in Central was completed in the quarter with the opening of H&amp;M as its anchor tenant in March. </FONT> <P align=justify><FONT color=#000000 size=3>During the quarter, rents for prime street shops grew by 3.3 percent while prime and decentralized shopping center rentals grew by 5.6 percent and 2.9 percent respectively. Leveraging on the existing momentum and additional stimulus from tax relief, we expect a more positive outlook. </FONT> <P align=justify><FONT color=#000000 size=3>Rents in prime streets and prime shopping centers could continue to achieve moderate rental growth in the next 12-month period. </FONT> <P align=justify><FONT color=#000000 size=3>In the residential market, the sales market saw a significant pick-up in transaction volume in the first quarter, driven primarily by lower mortgage rates and improved buyer affordability stemming from salary increases and year-end bonuses. </FONT> <P align=justify><FONT color=#000000 size=3>The generous offerings in the 2007-08 budget will also relieve the financial burden of property buyers, thus triggering stronger "end-user" demand. </FONT> <P align=justify><FONT color=#000000 size=3>The number of residential sale and purchase agreements rose by 31.6 percent year on year to 23,328 units during the quarter. </FONT> <P align=justify><FONT color=#000000 size=3>During the quarter, capital values for luxury properties rose by 5.1 percent. </FONT> <P align=justify><FONT color=#000000 size=3>Demand for high-end properties remained strong for the leasing market, with those on Hong Kong Island particularly sought after. </FONT> <P align=justify><FONT color=#000000 size=3>The remaining units in Hos Villa in Stanley and Luard on the Park in Wan Chai were all leased out in the quarter. Rents recorded a rise of 1.9 percent in the same period. </FONT> <P align=justify><FONT color=#000000 size=3>The pay rises underpinned by the buoyant labor market and the generous offerings in the 2007-08 budget, will help boost buyer confidence and trigger upgrading demand. </FONT> <P align=justify><FONT color=#000000 size=3>Capital values for the overall residential market will continue to grow while rental values for luxury properties will continue to rise on the back of the inflow of expatriates and tight supply. </FONT> <P align=justify><FONT color=#000000 size=3>In the industrial market, the momentum of the warehouse market remained strong during the quarter, on the back of a robust trading environment. </FONT> <P align=justify><FONT color=#000000 size=3>Total imports and exports grew by 9 percent year on year in the first two months. </FONT> <P align=justify><FONT color=#000000 size=3>The outlook for local consumption and retail sales in Hong Kong remained upbeat, leading to sustained demand for warehouses from retailer and other logistics operator. </FONT> <P align=justify><FONT color=#000000 size=3>The quarter saw a pickup in leasing activity. </FONT> <P align=justify><FONT color=#000000 size=3>The sales market continued to be energetic amidst the limited availability of large and quality warehouse space for sale in the market. Sales transactions were more for smaller and strata-titled properties (on a floor-by-floor basis). </FONT> <P align=justify><FONT color=#000000 size=3>The narrowing choice of warehouse stocks started to divert the attention of institutional investors to other industrial premises including flatted factories and industrial-office buildings. </FONT> <P align=justify><FONT color=#000000 size=3>During the quarter, no new warehouse completion was recorded. Warehouse rents and capital values rose by 0.2 percent and 0.8 percent, respectively. With such vibrant economic growth, local consumption and other business investment activities will help ensure a sustained level of domestically driven warehouse demand. </FONT> <P align=justify><FONT color=#000000 size=3>The external trade sector will continue to benefit from China's growing export activity, putting healthy pressure on Hong Kong's warehouse properties and other logistics facilities. </FONT> <P align=justify><FONT color=#000000 size=3>Wee-Liat Lee is head of research, Greater China, at Jones Lang LaSalle</FONT> <P>News from the Standard</SPAN></P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=249 2007-05-09 <![CDATA[Profit will depend on high flat prices, say agents]]> <font face='Arial, Helvetica, sans-serif'>Estate agents reckon the consortium that bagged the residential site at <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" /><st1:Street><st1:address><SPAN lang=EN-US>Yan Cheung Road</SPAN></st1:address></st1:Street><SPAN lang=EN-US> in </SPAN><st1:place><SPAN lang=EN-US>West Kowloon</SPAN></st1:place><SPAN lang=EN-US> will have to sell flats for at least HK$8,000 per square foot to make a profit. <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" /><o:p></o:p></SPAN> <P style="MARGIN: 0cm 0cm 0pt" class=MsoNormal align=justify><SPAN lang=EN-US><o:p><FONT color=#000000 size=3 face="Times New Roman">&nbsp;</FONT></o:p></SPAN></P> <P style="MARGIN: 0cm 0cm 0pt" class=MsoNormal align=justify><SPAN lang=EN-US><FONT color=#000000><FONT face="Times New Roman"><FONT size=3>Midland Realty chief analyst Buggle Lau Ka-fai said that with accommodation value at HK$6,147 psf, break-even price would be about HK$7,000 psf. <o:p></o:p></FONT></FONT></FONT></SPAN></P> <P style="MARGIN: 0cm 0cm 0pt" class=MsoNormal align=justify><SPAN lang=EN-US><FONT color=#000000><FONT face="Times New Roman"><FONT size=3>"With a 20 percent margin, the selling price would be about HK$8,000 (psf)," Lau said. <o:p></o:p></FONT></FONT></FONT></SPAN></P> <P style="MARGIN: 0cm 0cm 0pt" class=MsoNormal align=justify><SPAN lang=EN-US><o:p><FONT color=#000000 size=3 face="Times New Roman">&nbsp;</FONT></o:p></SPAN></P> <P style="MARGIN: 0cm 0cm 0pt" class=MsoNormal align=justify><SPAN lang=EN-US><FONT color=#000000><FONT face="Times New Roman"><FONT size=3>While the site may not compare with the location of the Waterfront at Kowloon Station for example, the projected selling price represents a 20 percent premium on secondary market prices in the area. <o:p></o:p></FONT></FONT></FONT></SPAN></P> <P style="MARGIN: 0cm 0cm 0pt" class=MsoNormal align=justify><SPAN lang=EN-US><o:p><FONT color=#000000 size=3 face="Times New Roman">&nbsp;</FONT></o:p></SPAN></P> <P style="MARGIN: 0cm 0cm 0pt" class=MsoNormal align=justify><SPAN lang=EN-US><FONT color=#000000><FONT face="Times New Roman"><FONT size=3>Although the site's final price of HK$4 billion was on the low end of market estimates, it was still a good outcome, Lau said. <o:p></o:p></FONT></FONT></FONT></SPAN></P> <P style="MARGIN: 0cm 0cm 0pt" class=MsoNormal align=justify><SPAN lang=EN-US><o:p><FONT color=#000000 size=3 face="Times New Roman">&nbsp;</FONT></o:p></SPAN></P> <P style="MARGIN: 0cm 0cm 0pt" class=MsoNormal align=justify><FONT color=#000000><FONT face="Times New Roman"><FONT size=3><SPAN lang=EN-US>He noted the site's accommodation value was about 14 percent higher than two plots sold at auction in September 2005 when two adjoining sites opposite </SPAN><st1:Street><st1:address><SPAN lang=EN-US>Hoi Fu Court</SPAN></st1:address></st1:Street><SPAN lang=EN-US> and </SPAN><st1:place><SPAN lang=EN-US>Park Avenue</SPAN></st1:place><SPAN lang=EN-US> fetched between HK$5,300 and HK$5,400 psf. <o:p></o:p></SPAN></FONT></FONT></FONT></P> <P style="MARGIN: 0cm 0cm 0pt" class=MsoNormal align=justify><SPAN lang=EN-US><o:p><FONT color=#000000 size=3 face="Times New Roman">&nbsp;</FONT></o:p></SPAN></P> <P style="MARGIN: 0cm 0cm 0pt" class=MsoNormal align=justify><FONT color=#000000><FONT face="Times New Roman"><FONT size=3><SPAN lang=EN-US>It was also a consortium involving </SPAN><st1:place><st1:PlaceName><SPAN lang=EN-US>Sino</SPAN></st1:PlaceName><SPAN lang=EN-US> </SPAN><st1:PlaceType><SPAN lang=EN-US>Land</SPAN></st1:PlaceType></st1:place><SPAN lang=EN-US> (0083), Nan Fung Development, and Chinese Estates Holdings (0127), that won those sites. <o:p></o:p></SPAN></FONT></FONT></FONT></P> <P style="MARGIN: 0cm 0cm 0pt" class=MsoNormal align=justify><SPAN lang=EN-US><o:p><FONT color=#000000 size=3 face="Times New Roman">&nbsp;</FONT></o:p></SPAN></P> <P style="MARGIN: 0cm 0cm 0pt" class=MsoNormal align=justify><SPAN lang=EN-US><FONT color=#000000><FONT face="Times New Roman"><FONT size=3>Lau said the latest land sale may not stimulate secondary prices too much as the market had been over-optimistic with their estimates before the auction. "With [the final price] at the lower end of the market, some owners may not be so aggressive in hiking their prices," Lau said. <o:p></o:p></FONT></FONT></FONT></SPAN></P> <P style="MARGIN: 0cm 0cm 0pt" class=MsoNormal align=justify><SPAN lang=EN-US><o:p><FONT color=#000000 size=3 face="Times New Roman">&nbsp;</FONT></o:p></SPAN></P> <P style="MARGIN: 0cm 0cm 0pt" class=MsoNormal align=justify><SPAN lang=EN-US><FONT color=#000000><FONT face="Times New Roman"><FONT size=3>Ricacorp Properties executive director Willy Liu Wai-keung agreed the lower-than-expected price would be healthier to the market. </FONT></FONT></FONT></SPAN></P> <P style="MARGIN: 0cm 0cm 0pt" class=MsoNormal align=justify><SPAN lang=EN-US><FONT color=#000000><FONT face="Times New Roman"><FONT size=3></FONT></FONT></FONT></SPAN>&nbsp;</P> <P style="MARGIN: 0cm 0cm 0pt" class=MsoNormal align=justify><SPAN lang=EN-US><FONT color=#000000><FONT size=2><o:p>News from the Standard</o:p></FONT></FONT></SPAN></P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=248 2007-05-08 <![CDATA[Gray areas persist after flats talks]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>Talks by the developers' trade association and three other concerned parties over the salable area of residential properties and how to display it clearly to buyers ended Monday without clear agreement on the details. </FONT></P> <P align=justify><FONT color=#000000 size=3>The only thing agreed upon following the two-hour meeting involving representatives of the Real Estate Developers' Association, the Consumer Council, the Hong Kong Institute of Surveyors and the Housing, Planning and Lands Bureau was a consensus that buyers deserved less ambiguous information regarding salable area. </FONT></P> <P align=justify><FONT color=#000000 size=3>REDA vice chairman Stewart Leung Chi-kin said the association hoped developers would give out price lists including a breakdown of salable area for the main areas, and items such as bay windows, starting June 1. </FONT></P> <P align=justify><FONT color=#000000 size=3>Hong Kong Institute of Surveyors president Raymond Chan Yuk-ming said details on salable area still needed further study, starting with an internal meeting at the institute, but no timetable was given. </FONT></P> <P align=justify><FONT color=#000000 size=3>Early last month the government briefed the Legislative Council's panel on housing on possible measures to enhance transparency of salable area. </FONT></P> <P align=justify><FONT color=#000000 size=3>The institute in particular has proposed revising its code on measurement of salable area to remove gray areas created by new building technologies. </FONT></P> <P align=justify><FONT color=#000000 size=3>It proposes that salable area should be measured in two parts: the main area such as bedrooms, and the secondary area such as bay windows, as well as unifying the various Chinese terms for salable area which have confused buyers. </FONT></P> <P align=justify><FONT color=#000000 size=3>Buyers have complained about the air-conditioning room being counted as part of the salable area, along with discovering the actual usable area is much smaller than salable area. </FONT></P> <P align=justify><FONT color=#000000 size=3>Cheung Kong (Holdings) (0001) executive director Justin Chiu Kwok-hung said the developer followed government regulations in giving a breakdown of the salable area in its sales brochures. </FONT></P> <P align=justify><FONT color=#000000 size=3>"Sometimes everybody is too busy to look at it," he said. </FONT></P> <P align=justify>News from the Standard<BR></P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=247 2007-05-04 <![CDATA[Central rents go through the roof]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>By any account, the recent report by property consultant DTZ Debenham Tie Leung makes for grim reading, especially for tenants of office space in Hong Kong, particularly in Central. </FONT></P> <P align=justify><FONT color=#000000 size=3>The Grade A market for top-of-the-heap office space continued upward in the first quarter of this year, with average net effective rents in Central hitting HK$85 per square foot. </FONT></P> <P align=justify><FONT color=#000000 size=3>"Rentals are at an all-time high," said DTZ director for consulting and research Alva To Yu- hung. </FONT></P> <P align=justify><FONT color=#000000 size=3>However, DTZ stressed this figure represented an average for the area. </FONT></P> <P align=justify><FONT color=#000000 size=3>The main culprits for the jump in rents are the FIRE - finance, insurance, real estate and other professional services - sector, hedge funds and investment banks. </FONT></P> <P align=justify><FONT color=#000000 size=3>In Central, the FIRE sector occupies 76.5 percent of the unit sizes of more than 25,000 square feet whereas the legal sector occupies 8.5 percent and public administration and consulates occupy 4.8 percent. </FONT></P> <P align=justify><FONT color=#000000 size=3>To said if one talks of actual rents, then the previous high in Central was in 1994 when HK$120 psf was achieved. </FONT></P> <P align=justify><FONT color=#000000 size=3>"But now, at Two IFC, it's over HK$160," he said. </FONT></P> <P align=justify><FONT color=#000000 size=3>The other factor driving up rents is the low level of new supply coming on stream. </FONT></P> <P align=justify><FONT color=#000000 size=3>Last year, only two new Grade A office buildings were completed, supplying about 256,700 sq ft of space. </FONT></P> <P align=justify><FONT color=#000000 size=3>They are York House, belonging to Hongkong Land, which offers 115,000 sq ft, and 100QRC at 100 Queen's Road Central, which offers 142,000 sq ft. </FONT></P> <P align=justify><FONT color=#000000 size=3>This new space was quickly snapped up as DTZ statistics indicate. </FONT></P> <P align=justify><FONT color=#000000 size=3>In the third quarter of last year, the vacancy rate in Central was 4.2 percent, which then rose to 4.5 percent in the fourth quarter as the two buildings received occupation permits from the Buildings Department. </FONT></P> <P align=justify><FONT color=#000000 size=3>However, in the first quarter, it dropped 0.8 percentage points to 3.7 percent. </FONT></P> <P align=justify><FONT color=#000000 size=3>Savills, the leasing agent for 100QRC, said it is all leased out apart from the sixth floor, which is the latest level to be released. </FONT></P> <P align=justify><FONT color=#000000 size=3>The asking rent is from HK$35 psf to HK$40 psf. </FONT></P> <P align=justify><FONT color=#000000 size=3>However, about 420 meters down the road, York House has asked for more than HK$100 psf. </FONT></P> <P align=justify><FONT color=#000000 size=3>While the Grade A office market in Central has grabbed all the headlines with irrepressible rents, tenants, especially budget-restrained companies and startups, can still go for the Grade B or Grade C offices. </FONT></P> <P align=justify><FONT color=#000000 size=3>LCH (Asia-Pacific) Surveyors managing director Joseph Ho Chin-choi, whose office is tucked away in one of the side streets in Central, said since startups have limited capital and do not need so much space, an office of 1,000 sq ft to 2,000 sq ft is sufficient - but such a size is difficult to find in Central. </FONT></P> <P align=justify><FONT color=#000000 size=3>"But if you need larger space at 3,000 to 4,000 square feet then it is easier to find," he said. </FONT></P> <P align=justify><FONT color=#000000 size=3>Grade B and Grade C offices, which have a less sophisticated construction, interior finish and facilities than Grade A, are going for about HK$16 psf to HK$20 psf, much more affordable than the likes of York House. <BR></FONT></P> <P>News from the Standard</P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=246 2007-04-09 <![CDATA[More than 4,300 new flats set to test market]]> <font face='Arial, Helvetica, sans-serif'>Developers are expected to launch more new projects this quarter to meet demand mainly in the mass residential market. <P align=justify><FONT color=#000000 size=3></FONT><FONT color=#000000 size=3><BR>Property agent Ricacorp estimates that up to 4,323 homes in 25 projects could hit the market. </FONT></P> <P align=justify><FONT color=#000000 size=3>The New Territories will account for most of the new supply with 2,131 units, followed by Kowloon with 1,574 and Hong Kong Island with 618. </FONT></P> <P align=justify><FONT color=#000000 size=3>The single biggest project is phase one of Central Park Towers in Tin Shui Wai, being built by Cheung Kong (Holdings) (0001), which has 1,902 flats in total. </FONT></P> <P align=justify><FONT color=#000000 size=3>Other projects are more modest in scale, with the next three projects, all in Kowloon, offering about 300 homes each. </FONT></P> <P align=justify><FONT color=#000000 size=3>SEA Holdings (0251) is building a 48-story residential and retail project with 304 flats at Po Kong Village Road in Diamond Hill. </FONT></P> <P align=justify><FONT color=#000000 size=3>The company said in its 2006 interim results that pre-sales are planned for early this year. </FONT></P> <P align=justify><FONT color=#000000 size=3>Henderson Land Development (0012) will offer 312 units in phase three of Metro Harbour View at Tai Kok Tsui, and another 326 in a mixed-use project at 500-502 Tung Chau Street, Cheung Sha Wan.</FONT></P> <P align=justify><FONT color=#000000 size=3>On the island, Swire Pacific (0019) and China Motor Bus (0026) are offering 184 flats at the junction of Kam Hong Street and Java Road, North Point. </FONT></P> <P align=justify><FONT color=#000000 size=3>Asia Standard International Group (0129) will offer 180 flats at its project at 238-242 Aberdeen Main Road. </FONT></P> <P align=justify><FONT color=#000000 size=3>Ricacorp Properties executive director Willy Liu Wai-keung said developers were quite active with new launches in the first quarter, especially last month, pointing to brisk sales at projects such as The Vineyard by Sun Hung Kai Properties (0016) and Bel- Air phase six by Pacific Century Premium Developments (0432). </FONT></P> <P align=justify><FONT color=#000000 size=3>Henderson Land managed to sell all 119 units at The Verdancy in Yuen Long in one weekend two weeks ago, generating HK$163 million. </FONT></P> <P align=justify><FONT color=#000000 size=3>"In the second quarter, there will not be much luxury property, but more mass residential such as Central Park Towers," Liu said. </FONT></P> <P align=justify><FONT color=#000000 size=3>Midland Realty chief analyst Buggle Lau Ka-fai said the market performed respectably in the first quarter. </FONT></P> <P align=justify><FONT color=#000000 size=3>"We believe the momentum will carry on to April and May but it may slow in June at the end of the quarter," Lau said, referring to the start of the summer holiday season.</FONT></P> <P align=justify><FONT color=#000000 size=3>Asked if the market would see more primary market sales, Lau said the first quarter saw about 2,700 deals involving new flats but more than 20,000 transactions in the secondary market. </FONT></P> <P align=justify><FONT color=#000000 size=3>"The secondary market will remain the driver in terms of quantity," he said. </FONT></P> <P align=justify>News from the Standard</P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=245 2007-04-04 <![CDATA[Property transactions soar 31pc]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>A revival in the secondary housing market lifted the number of overall residential property transactions by nearly a third in the first quarter, from a year earlier. </FONT></P> <P align=justify><FONT color=#000000 size=3>Land Registry figures released Tuesday show that 23,328 units changed hands in the first quarter, up 31.6 percent over the same quarter of 2006, when the market was weighed down by rising interest rates. </FONT></P> <P align=justify><FONT color=#000000 size=3>Sales rose 12.7 percent compared with 20,696 units in the fourth quarter of 2006. <BR>The figures show that 8,039 residential transactions were registered in March, up 3 percent over February, the fifth straight month of increases since November. </FONT></P> <P align=justify><FONT color=#000000 size=3>Patrick Chow Moon-kit, head of research at Ricacorp Properties, attributed the increase to the improved secondary residential market, which offset a lack of new project launches. </FONT></P> <P align=justify><FONT color=#000000 size=3>Chow said there were 7,099 transactions in the secondary market in March, an increase of 9.1 percent over February. </FONT></P> <P align=justify><FONT color=#000000 size=3>Fewer than 1,000 inventory flats in the primary market were sold last month. He expects overall residential property transactions in April to jump by 25 percent month- on-month to reach a 22-month high of more than 10,000 units. </FONT></P> <P align=justify><FONT color=#000000 size=3>In June 2005, when market activity was high, transactions amounted to 10,750 residential units. </FONT></P> <P align=justify><FONT color=#000000 size=3>"Positive factors such as the ongoing mortgage rates reductions by banks and the government's recent move to cut stamp duty for lower-priced flats will be reflected in this month's Land Registry figures," Chow said. </FONT></P> <P align=justify><FONT color=#000000 size=3>Sales and purchase agreements have to be lodged with the Land Registry during a 30-day window. So a particular month's statistics generally reflect transactions in the previous month. </FONT></P> <P align=justify><FONT color=#000000 size=3>New World Development (0017) managing director Henry Cheng Kar-shun said the lower-priced flats market will be steady this year. </FONT></P> <P align=justify><FONT color=#000000 size=3>He also expects brisk residential property sales during the upcoming Easter holidays. <BR>"The robust luxury residential sector will continue to outperform other housing markets," he added. </FONT></P> <P align=justify><FONT color=#000000 size=3>Chow of Ricacorp said luxury housing prices rose 8 percent in the first quarter of this year amid limited supply. </FONT></P> <P align=justify><FONT color=#000000 size=3>Mass residential market prices gained 3.5 percent during the quarter, he added. </FONT></P> <P align=justify><FONT color=#000000>News from the Standard<BR></P></FONT><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=244 2007-03-09 <![CDATA[Cut in stamp duty cheers market]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy><FONT color=#000000 size=3>The divergence in prices between the high end and the mass market is likely to be narrowed gradually, as the general housing market may benefit from the cut in stamp duty, market watchers said. </FONT> <P align=justify><FONT color=#000000 size=3>Last week, the government slashed the rate of stamp duty for property transactions valued between HK$1 million and HK$2 million from 0.75 percent to a fixed amount of HK$100, the same as for properties valued at HK$1 million or less. </FONT> <P align=justify><FONT color=#000000 size=3>"Demand for smaller priced flats will increase as a result of the cut," said Fredy Wu Yat-fat, chief executive of Hong Kong Property Services (Agency). "The move would help improve the upgrading sector in the small- and medium-sized residential market, where the price growth has been lagging the high-end market." </FONT> <P align=justify><FONT color=#000000 size=3>Developers and real-estate agents said the luxury residential market outperformed the general housing sector last year. </FONT> <P align=justify><FONT color=#000000 size=3>The mixed results at November's auction of a luxury site in Kowloon Tong and a Ma On Shan site suitable for mass residential housing raised concern over the divergence in prices between the high end and the mass market, market watchers said. </FONT> <P align=justify><FONT color=#000000 size=3>Sino Land (0083) bought the coveted Kowloon Tong site for HK$1.94 billion, beating forecasts of between HK$1.3 billion and HK$1.8 billion. </FONT> <P align=justify><FONT color=#000000 size=3>At the same auction, Cheung Kong (Holdings) (0001) purchased the Ma On Shan site for HK$3.24 billion, which was at the low end of market expectations. </FONT> <P align=justify><FONT color=#000000 size=3>Market watchers attributed the mixed results to limited supply of luxury housing sites compared to those in the general residential market. </FONT> <P align=justify><FONT color=#000000 size=3>In 2006, flats in the price range of between HK$1 million and HK$2 million accounted for 31.2 percent of total residential transactions, according to Midland Realty. </FONT> <P align=justify><FONT color=#000000 size=3>The agent estimated flat transactions in this price range in the primary and secondary markets will climb 40 percent from 2006's figure of 25,737 cases to 36,032 cases in 2007. </FONT> <P align=justify><FONT color=#000000 size=3>Cheung Kong's deputy chief manager for sales, Francis Wong See-chung, said the reduction in stamp duty would be helpful to those seeking to buy bigger apartments. "Those owning flats worth more than HK$1 million can upgrade to flats worth more than HK$2 million or higher," he added. </FONT> <P align=justify><FONT color=#000000 size=3>Ricacorp Properties last week carried out a poll of prospective buyers, in which 44 percent of the respondents said the cut in stamp duty fueled their interest in entering the market. </FONT> <P align=justify><FONT color=#000000 size=3>The agency also reported that owners of lower- priced flats at eight large housing estates such as City One in Sha Tin have raised asking prices by 3 percent to 5 percent. </FONT> <P align=justify><FONT color=#000000 size=3>At Caribbean Coast in Tung Chung, 20 percent of the owners immediately raised prices last week while 15 percent halted sales "without hesitation" because they expect home prices will continue to rise till the end of this year. </FONT> <P align=justify><FONT color=#000000 size=3>Louis Chan Wing-kit, executive director of Centaline Property Agency, said the reduction in stamp duty may stimulate short-term investors' demand for properties valued below HK$2 million. "Both the resale and primary housing markets for lower-priced flats will be more active this year as some investors are switching their focus to the small- and medium-sized flat market," Chan added. </FONT> <P align=justify><FONT color=#000000 size=3>The government announced last week that it will also waive rates for the first two quarters of the 2007-08 fiscal year, up to a ceiling of HK$5,000 for each rateable property. </FONT> <P align=justify><FONT color=#000000 size=3>Although it will not have the same effect on the property market as the cut in stamp duty, market watchers said it will, along with the salary tax rebates, help stimulate spending. </FONT> <P align=justify><FONT color=#000000 size=3>"The reduction in stamp duty on property transactions, and waiving rates for two quarters will ease the burden on homebuyers, which in turn will have a positive impact on the property market," said Sun Hung Kai Properties (0016) vice chairman Thomas Kwok Ping-kwong. </FONT> <P align=justify><FONT color=#000000 size=3>Property consultancy firm Knight Frank said activity in the luxury residential market in January was stimulated by the higher-than-expected land auction prices, adding that transactions of luxury homes worth more than HK$10 million more than doubled to 287 in January compared with the same period last year. </FONT> <P align=justify><FONT color=#000000 size=3>"Landlords held firm on asking prices. Some even withdrew their properties from the market, expecting greater capital value appreciation in the future," the firm said. </FONT> <P align=justify><FONT color=#000000 size=3>Higher transaction prices were recorded in all the traditional luxury residential districts. </FONT> <P align=justify><FONT color=#000000 size=3>"Buyers included not only local investors and upgraders but also expatriates, whose interest in the luxury residential sector has recently been on the rise," Knight Frank said. </FONT> <P align=justify><FONT color=#000000 size=3>The uptrend in luxury residential rentals remained intact during January, with robust leasing activity supported by a continual influx of expatriates. Mid-management expatriates were mainly looking for units in the HK$35,000-HK$60,000 monthly rental range. A number of leasing transactions with a monthly rental approaching HK$200,000 were also recorded, it said. </FONT> <P align=justify><FONT color=#000000 size=3>Knight Frank said developers have been keen to strengthen their luxury residential land banks amid rising prices and limited supply. For example, K Wah International (0173) successfully triggered for auction a prime residential site at Pak Shek Kok in Tai Po. The 214,225-square-foot site can be developed into a 749,788-sq-ft luxury residential project providing about 500 homes selling for up to HK$8,000 psf. </FONT> <P align=justify><FONT color=#000000 size=3>Some other developers have been active in bulk acquisition, even purchasing whole estates for redevelopment, said Knight Frank, adding that a locally listed property firm acquired through a private tender all 33 luxury units in the four-story Hacienda building in Island South for HK$1 billion. Meanwhile, Banyan Villas development in Island South was recently sold for HK$500 million or HK$12,531 psf. The project has 50 units in 19 blocks with a total floor area of 39,900 square feet. The 18,000-sq-ft site has a plot ratio of five and can be redeveloped into a 91,000-sq-ft luxury residential project. </FONT> <P align=justify><FONT color=#000000 size=3>Knight Frank said better-than-expected land auction results and a lack of luxury residential sites have also encouraged the government to consider releasing more land for sale in the application list for the next fiscal year. </FONT> <P align=justify><FONT color=#000000 size=3>Luxury sites being considered include vacant government quarters in urban areas that have the potential to be redeveloped into luxury residential properties, the consultancy firm said. </FONT> <P align=justify><FONT color=#000000 size=3>It said developers' efforts to acquire more luxury residential sites are unlikely to create a significant amount of new supply in the short term as development of new projects takes at least two years. The supply of luxury residential homes will remain tight throughout 2007, and average prices are likely to rise by 15-20 percent by the end of the year, Knight Frank predicted. </FONT> <P align=justify><FONT color=#000000 size=3>Prices for the mass market may rise as much as 20 percent this year, property agents said. </FONT> <P>News from the Standard</SPAN></P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=243 2007-02-27 <![CDATA[URA looks to past for shops scheme]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy><FONT color=#000000 size=3>The Urban Renewal Authority has come up with a HK$3.8 billion redevelopment plan to turn a century-old wet market and its surroundings in Sheung Wan into Hong Kong's first "Old Shops Street," with an area for hawkers. </FONT> <P align=justify><FONT color=#000000 size=3>"We hope to retain as much as possible ... We will see if we can create an old shops street in the area to bring back old names that are familiar to Hong Kong people," authority managing director Billy Lam Chung-lun said. </FONT> <P align=justify><FONT color=#000000 size=3>The Peel Street and Graham Street project is bounded by Gage, Cochrane and Wellington streets and Kin Sau Lane. </FONT> <P align=justify><FONT color=#000000 size=3>The 57,000-square-foot site will be turned into two residential buildings, a hotel and an office tower, all of which will be between 26 and 33 stories. </FONT> <P align=justify><FONT color=#000000 size=3>The project will affect 37 blocks, 360 vendors and shops, and 1,120 residents. </FONT> <P align=justify><FONT color=#000000 size=3>Four of the buildings were built before World War II while most of the others were built between the mid 50s and the late 60s. </FONT> <P align=justify><FONT color=#000000 size=3>Lam said the aim was to bring back the old charm and streetscapes. </FONT> <P align=justify><FONT color=#000000 size=3>He said three prewar shop houses will be preserved and put to adaptive re-use while the facade of Wing Woo Grocery will be conserved, subject to a structural engineering feasibility study. </FONT> <P align=justify><FONT color=#000000 size=3>The plan also incorporates a variety of hawking activities in Graham Street, Peel Street and Gage Street. </FONT> <P align=justify><FONT color=#000000 size=3>It is expected that about HK$1.8 billion to HK$2 billion of the HK$3.8 billion cost will be used to relocate and reclaim land from property owners and residents. However, the authority did not reveal how much it was offering per square foot. </FONT> <P align=justify><FONT color=#000000 size=3>According to the authority's standard policy, compensation would be aligned to other properties in the same area with a background of at least seven years, which would put compensation between HK$6,000 and HK$7,000 per square foot. </FONT> <P align=justify><FONT color=#000000 size=3>A store owner said she would not settle for anything less than HK$7,000 as rent levels in the area have always been high and relocation costs are steep. </FONT> <P align=justify><FONT color=#000000 size=3>Others said they were not too keen to move away because of either emotional attachment or the possible loss of old customers. </FONT> <P align=justify><FONT size=3><FONT color=#000000>The project was one of 25 announced but not started by the former Land Development Corporation in 1998. The authority said it would maintain talks with residents and the district council on the plan.</FONT> </FONT> <P>News from the Standard</SPAN></P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=242 2007-02-24 <![CDATA[Wait-and-see on property hikes]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodycopy1><SPAN style="FONT-SIZE: 11pt"><FONT face=Verdana>Developers are waiting to see the effect of the latest mortgage-rate cuts on the property market before they consider hiking prices. <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" /><o:p></o:p></FONT></SPAN></SPAN> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Tony Tse Wai-chuen, general manager for sales at Henderson Land Development (0012), said that after HSBC (0005) announced its new mortgage deal the company did not immediately review prices for its current sales campaign involving more than 1,000 inventory and new project units. </SPAN><o:p></o:p></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">"We need to see the reaction of the market first," Tse said, adding any price hike depends on market circumstances. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">HSBC cut its effective mortgage rate Thursday from 5 percent to 4.87 percent, sparking off a new round of rate cuts by rival banks. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Willy Liu Wai-keung, executive director of estate agent Ricacorp Properties, said: "I have not heard of official price increases, but I hear there could be price increases soon. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">"The cut by HSBC is not that much, so overall price increases will not happen very soon." <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">He expected developers to take advantage of the new mortgage deals to sell more flats but added: "Price increases could cause sales to slow so developers may not all hike prices." <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Buggle Lau Kai-fai, chief analyst at Midland Realty, agreed developers were generally quiet on prices. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">"HSBC has cut [mortgage rates] a little. It's still positive [news] but I haven't seen developers immediately hiking prices just because there was a rate cut," Lau said. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Asked about the reaction on the secondary market, Lau pointed out the lunar holiday period has not yet ended and some people have been back at work for only a few days. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">"A lot of people are still on holiday. We need to wait till next week before assessing the situation," Lau said. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Nonetheless, </SPAN><?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" /><st1:place><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Midland</SPAN></st1:place><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> figures show a 49 percent jump in the number of appointments made to view flats this weekend. </SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"><FONT size=2>News from the Standard<o:p></o:p></FONT></SPAN></P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=241 2007-02-23 <![CDATA[HSBC rate cut set to spark mortgage war]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>Hongkong and Shanghai Banking Corp is expected to trigger another home- loan price war after it dropped its mortgage lending rate Thursday to 4.87 percent from 5 percent.</FONT></P> <P align=justify><FONT color=#000000 size=3>"As the property market is picking up and is expected to grow steadily this year, this is the right time to introduce the mortgage promotion," said Diana Cesar, HSBC's head of deposits, mortgages and special projects, personal financial service, Asia Pacific. </FONT></P> <P align=justify><FONT color=#000000 size=3>"I expect that our rival mortgage players will introduce other offers in succession."</FONT></P> <P align=justify><FONT color=#000000 size=3>HSBC's latest mortgage offer is based on a prime lending rate of 7.75 percent minus 2.88 percent, reduced from the previous prime minus 2.75 percent.</FONT></P> <P align=justify><FONT color=#000000 size=3>The offer, running until April 30, is applicable to customers borrowing a minimum of HK$500,000. The mortgages are available for purchases of new or secondhand homes or to people looking to refinance. </FONT></P> <P align=justify><FONT color=#000000 size=3>The offer does not apply to government Home Ownership Scheme or Tenants' Purchase Scheme properties.</FONT></P> <P align=justify><FONT color=#000000 size=3>In addition to the lower mortgage rate, Cesar said customers will be entitled to a "Lunar New Year lai see" in the form of a credit-card spending rebate of HK$8,888 for every HK$1 million drawn on mortgage loans of HK$3 million or more.</FONT></P> <P align=justify><FONT color=#000000 size=3>For loans of HK$1 million to less than HK$3 million, customers will receive HK$7,888 for every HK$1 million advanced, and for loans of HK$500,000 to HK$999,999, they will get HK$1,888. "The rebate could help our customers save some expenditure, such as buying furniture for the new year," Cesar said.</FONT></P> <P align=justify><FONT color=#000000 size=3>Real-estate agents said the latest cut in mortgage rates would boost the property market. </FONT></P> <P align=justify><FONT color=#000000 size=3>"Although the cut is not a lot, the main message is that the effective mortgage rate is being maintained at a comparatively low level," Midland Realty chief analyst Buggle Lau Ka-fai said. </FONT></P> <P align=justify><FONT color=#000000 size=3>Developers are expected to accelerate their plans to launch new projects for sale as a result of the rate cut, Lau added. </FONT></P> <P align=justify><FONT color=#000000 size=3>Donald Cheng Wai-hung, principal vice president at mortgage agency mReferral, expects other large banks to follow suit with similar offers in a bid to increase or defend their market share.</FONT></P> <P align=justify><FONT color=#000000 size=3>Latest statistics for January compiled by mReferral show Bank of China (Hong Kong) (2388) first in the market share stakes with 16.8 percent, followed by Hang Seng Bank (0011) with 12.6 percent and HSBC with 11.9 percent.</FONT></P> <P align=justify><FONT color=#000000 size=3>Ricacorp Properties conducted a survey of 100 prospective home buyers Thursday, 46 percent of whom said HSBC's rate cut was likely to speed up their plans to buy an apartment, while 29 percent reckoned property prices could go up by 5 percent to 10 percent in the first half of 2007 because of increased demand. </FONT></P> <P align=justify><FONT color=#000000 size=3>In February 2006, Hongkong and Shanghai Bank - a unit of global giant HSBC Holdings (0005) - also fired the first salvo in another mortgage price battle by cutting its mortgage rate to grab business.</FONT></P> <P align=justify><FONT color=#000000 size=3>HSBC ended 2006 with the biggest slice of the mortgage market at 17.6 percent, followed by BOCHK at 15.9 percent and Hang Seng Bank at 13.8 percent.</FONT></P> <P align=justify><FONT color=#000000 size=3>In 2005, BOCHK topped the list with a 20.8 percent market share, while HSBC was fourth with 9.8 percent. BOCHK currently offers mortgages at prime minus 2.75 percent, or 5 percent, plus a rebate rate of 0.2 percent to 0.4 percent. </FONT></P> <P align=justify><FONT color=#000000 size=3>Another rival, Standard Chartered (2888), offers mortgages at prime minus 2.75 percent to 3 percent, or 5 percent to 5.25 percent.</FONT></P> <P align=justify><FONT color=#000000 size=3>Among smaller lenders, Chong Hing Bank (1111) currently offers home loans at 4.85 percent, while mortgages at Bank of East Asia (0023) range from 4.72 percent to 4.85 percent. </FONT></P> <P align=justify><FONT color=#000000></FONT>&nbsp;<EM>News from the Standard</EM></P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=240 2007-02-21 <![CDATA[Pollution key in drive for concessions on balconies]]> <font face='Arial, Helvetica, sans-serif'><FONT face=Verdana>Balconies can play a part in the territory's war against air and noise pollution, a leading <FONT color=#000000><?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" /><st1:place><st1:PlaceName><SPAN class=bodycopy1><SPAN style="FONT-SIZE: 11pt">Hong Kong</SPAN></SPAN></st1:PlaceName><SPAN class=bodycopy1><SPAN style="FONT-SIZE: 11pt"> </SPAN></SPAN><st1:PlaceType><SPAN class=bodycopy1><SPAN style="FONT-SIZE: 11pt">University</SPAN></SPAN></st1:PlaceType></st1:place><SPAN class=bodycopy1><SPAN style="FONT-SIZE: 11pt"> professor argues. <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" /><o:p></o:p></SPAN></SPAN></FONT></FONT> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Referring to a study he conducted with his colleagues, real estate and construction chair professor Chau Kwong- wing said deteriorating air quality and rising noise pollution in </SPAN><st1:place><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Hong Kong</SPAN></st1:place><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> can be greatly reduced starting at homes. </SPAN><o:p></o:p></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Speaking to The Standard, Chau also called for a government review of the concession scheme for balconies with a view to extending the building feature further. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Chau's team examined 1,189 property transactions at Mei Foo Sun Chuen from July 1999 to March 2001 to determine how much residents are willing to pay for clean air and a good night's sleep. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">They chose Mei Foo Sun Chuen because it is one of the largest housing estates in </SPAN><st1:place><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Hong Kong</SPAN></st1:place><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">They found residents are willing to pay a higher price for flats with balconies, which are believed to serve as buffer zones in mitigating air and noise pollution. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">In general, pollution reduces property values by 10 percent for flats without balconies while the value enhancement effect on those units that have the feature is greater when accompanied by road views. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">The researchers concluded a balcony is more valuable in a more polluted environment and that the impact of a road on a nearby flat's price can be mitigated by the provision of balconies. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">"It is worthwhile to sacrifice some internal floor area to build a balcony for the mitigation of pollution, as the unit construction cost of a balcony is likely to be similar to that of internal floor space," Chau's team wrote in a paper published in 2005 in Habitat International, an authoritative journal for the study of human settlements established at the United Nations Habitat Conference in Vancouver in 1976. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">"A balcony is, among other things, a proposed `green' provision which acts as an integrated `environmental filter' for mitigating traffic noise, a provider of planting space, and an enhancer of energy efficiency," they said. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Chau said the balconies can be utilized more cost-effectively to filter both air and noise pollution. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">"[The fact that] people [are] willing to pay for flats with balconies is a broad indication that they are concerned about the quality of the environment," he said. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">A well-maintained balcony can resonate "green effects" via plants and shade that absorb pollutants as well as noise, Chau said. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">"Balconies can also serve as canopies to reduce energy consumption by filtering light," he said. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Chau noted that the greenhouse effect can be checked when internal areas are shaded, reducing the need to turn on air conditioners. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">In 2001, the government launched a concession scheme under which balcony areas are exempt from the calculation of the maximum developable area subject to the payment of a balcony premium ranging from zero to HK$38,600 per square meter as of April 2001. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">According to James Chang King-tat, senior associate director of Centaline Surveyor, </SPAN><st1:place><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Hong Kong</SPAN></st1:place><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> is likely to see an increase in the construction of balconies in the future. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">"Ever since the introduction of balconies as projecting green features, balconies have become more attractive," he said. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">"Since the exemption of balconies from the construction floor area, developers are more likely to build flats and housing estates with balconies," Chang said. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">"Generally, flats with balconies are more popular but the price of a flat depends on various factors," said Bonnie Ngan Suet-fong, general manager of corporate communications at Henderson Land Development, which first built flats with balconies in a Sha Tin pilot project in 1981. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Ngan said factors such as location, design, demand and access to public transportation facilities contribute to differences in costs, making it difficult to quantify price differences between units with balconies and those without the feature. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Chau's call comes amid increasing concern over air quality, with the Hong Kong Environmental Protection Association last week calling the city a "world champion of carbon dioxide emissions." </SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"><FONT size=2>News from the Standard</FONT></SPAN></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=239 2007-02-16 <![CDATA[Experts call for clearer policy to end uncertainty]]> <font face='Arial, Helvetica, sans-serif'><FONT face=Verdana>Hoping to ease the scarcity of urban land, property experts have suggested the government take an active role to encourage collective sales and redevelopment activity. <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" /><o:p></o:p></FONT> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">"Clarification of policy and prompt announcement of height restrictions in various residential districts will help dispel uncertainties and facilitate collective sales activity," said Alnwick Chan, executive director of Knight Frank. </SPAN><o:p></o:p></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">The government plans to review restrictions in all districts and has begun to impose height limits on projects in Kowloon Tong and Wong Chuk Hang in Island South. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">But the new restrictions have not been announced in all districts at the same time. Government departments, including the Buildings Department, Lands Department and Planning Department, have yet to reach a consensus on how the height of a building should be measured under some of the older leases. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Chan said a highly restrictive policy on the compulsory sale of properties has also slowed collective sales activity. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">According to existing regulations, property owners have to own 90 percent or more before they can apply for the compulsory sale of the entire building. Such a threshold is prohibitively high. Though the government is considering lowering the threshold to 80 percent or less, a decision has yet to be made. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Centaline Surveyors agrees that the government should expedite legislation to lower the threshold under the ordinance for compulsory sale of properties as this will facilitate redevelopment and accelerate urban renewal. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">According to Knight Frank, redevelopment activity through collective sales is on the increase due to the shortage of available prime residential sites. "We expect that the high level of land prices fueled by December's auction of a luxury site on The Peak will further stimulate collective sales activity, particularly in areas like the Mid-Levels, where older but well-located buildings have yet to fully utilize their plot ratios," Chan said. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">A typical case is </SPAN><?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" /><st1:Street><st1:address><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Grand Court</SPAN></st1:address></st1:Street><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> at </SPAN><st1:Street><st1:address><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">18 Caine Road</SPAN></st1:address></st1:Street><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">This 9,000-square-foot site has a plot ratio of eight, representing a maximum developable area of about 86,200 square feet, which is more than double the current gross floor area. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">The majority owners of this 47-year- old residential property commissioned a consultancy firm to handle the tender sale, which closed last month. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">In December 2006, three more luxury residential properties were acquired by developers through collective sales, including New Eastern Terrace in North Point, Sun Fair Mansions in Mid- Levels East and Manly Court in Prince Edward in Kowloon. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Chan said the Lands Tribunal has recently granted an order for sale in respect of the 12 units at No6 Shiu Fai Terrace in Mid-Levels East. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">The property has a total of 12 units of which 11 are currently owned by K Wah Real Estate. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">It will be sold through a public auction in March with a reserve price of HK$284 million. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">K Wah is hoping to amalgamate the ownerships at the auction to enable the redevelopment of this old building. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Despite the increasing popularity of redevelopment and collective sales activity, no major increase in new supply is likely in the short term as redevelopment takes at least two years and collective sales face many obstacles, Chan said. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">In recent years, several developers have made use of the land ordinance. Kerry Properties (0683) completed a land purchase transaction for a HK$2 billion luxury housing project in </SPAN><st1:place><st1:PlaceName><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Happy</SPAN></st1:PlaceName><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> </SPAN><st1:PlaceType><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Valley</SPAN></st1:PlaceType></st1:place><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> by acquiring the site's remaining interests at October's auction, at the reserve price of HK$661 million. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">In September, Hopewell Holdings (0054) completed a land purchase deal for a site at </SPAN><st1:Street><st1:address><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">12 Broadwood Road</SPAN></st1:address></st1:Street><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> in </SPAN><st1:place><st1:PlaceName><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Happy</SPAN></st1:PlaceName><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> </SPAN><st1:PlaceType><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Valley</SPAN></st1:PlaceType></st1:place><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> which will be developed as a luxury residential rental property at a cost of about HK$500 million, or HK$4,500 psf. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">In June, Kowloon Development (0034) completed a 13-year quest to purchase a North Point site for a HK$500 million housing project, which will provide a gross floor area of 60,800 sq ft. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">In 2005, Swire Properties brought to an end a decade of land purchasing for a Mid-Levels residential project by acquiring the site's remaining interests at an auction. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Knight Frank's Chan said unclear policy in respect of height limits applied to properties has also created difficulties in assessing the redevelopment value of older buildings and impeded urban renewal. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Development restrictions in Ho Man Tin are also being studied by the government, sources said. The move follows the recent announcement of a lower plot ratio for a coveted residential site in the district available on the application list of land sales. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Developers would have less gross floor area to build if limits were to be imposed. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">These include height restrictions and the plot ratio, which governs how many apartments can be built on a site. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Some developers are concerned about how their profit margins will be affected by a potential lessening in the value of their property development sites in the districts. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">The Lands Department recently announced a plot ratio of five for a residential site at the junction of </SPAN><st1:Street><st1:address><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Fat Kwong Street</SPAN></st1:address></st1:Street><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> and </SPAN><st1:Street><st1:address><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Chung Hau Street</SPAN></st1:address></st1:Street><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> in Ho Man Tin, the single most valuable site available on the government's application list. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">The lower-than-expected plot ratio may reduce the value of the site, 1.62 hectares in extent, by 30 percent to about HK$7 billion, surveyors said. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">However, the attractiveness of two residential sites in Kowloon Tong available on the application list is unlikely to be affected by the new height restrictions, market watchers said. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Midland Surveyors director Alvin Lam Tze-pun expects the two sites - </SPAN><st1:Street><st1:address><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">1 Ede Road</SPAN></st1:address></st1:Street><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> and 3 and </SPAN><st1:Street><st1:address><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">5 Ede Road</SPAN></st1:address></st1:Street><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> - to be successfully taken off the application list for public auctions later this year after November's auction for another site in Kowloon Tong. <o:p></o:p></SPAN></P> <P align=justify><st1:place><st1:PlaceName><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Sino</SPAN></st1:PlaceName><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> </SPAN><st1:PlaceType><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Land</SPAN></st1:PlaceType></st1:place><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> (0083) won the coveted site at </SPAN><st1:Street><st1:address><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">1 Broadcast Drive</SPAN></st1:address></st1:Street><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> for HK$1.94 billion, or HK$9,868 per square foot, beating forecasts of between HK$1.3 billion and HK$1.8 billion. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">This was up 76.4 percent from the reserve price of HK$1.1 billion or HK$5,595 psf. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">That price was expected to set a benchmark for the </SPAN><st1:Street><st1:address><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">two Ede Road</SPAN></st1:address></st1:Street><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> sites in Kowloon Tong available on the government's reserve list, Lam said. <o:p></o:p></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Under the application list system, a developer has to submit a price for a site that is at least 80 percent of the government's own estimate to successfully trigger an auction. </SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"><FONT size=2>News from the Standard</FONT></SPAN></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=238 2007-02-09 <![CDATA[Boutique niche in serviced flats]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>Entrepreneurs Dinesh Nihalchand and Alex Bent recognized the buoyancy of the local serviced apartment market - and did something about it.<BR>The pair, operating as Kush Living, plan to open three blocks of serviced apartments in West Mid-Levels on Bonham Road in early summer, providing up to 100 rooms.</FONT></P> <P align=justify><FONT color=#000000 size=3>With several years' experience running serviced apartments behind them, they successfully convinced investors to buy en bloc buildings.</FONT></P> <P align=justify><FONT color=#000000 size=3>Bent said: "Twenty individual apartments we are operating now are all rented out."</FONT></P> <P align=justify><FONT color=#000000 size=3>Nihalchand added: "The serviced apartment market is buoyed up by an increasing number of expatriates looking for short- to medium-term accommodation in Hong Kong, ranging from one to six months. Such demand supports a strong and healthy rental market."</FONT></P> <P align=justify><FONT color=#000000 size=3>Nihalchand, 32, previously worked in the financial services sector.</FONT></P> <P align=justify><FONT color=#000000 size=3>Simon Smith, Savill deputy managing director and head of research and consultancy, said overall occupancy levels in the serviced apartment sector exceeded 90 percent in the final quarter of 2006.</FONT></P> <P align=justify><FONT color=#000000 size=3>"The booming financial services sector not only benefited the leasing market but also the serviced apartment segment with quite a number of project-based bankers and professionals drafted in," said Smith. Another factor was government policy which has brought increasing numbers of international exhibitions and conferences here.</FONT></P> <P align=justify><FONT color=#000000 size=3>Nihalchand said: "People love to come to Hong Kong and live here. Half a million expats now live in Hong Kong and there is a lack of serviced apartments." </FONT></P> <P align=justify><FONT color=#000000 size=3>Smith estimated that by the end of 2007 there will be 17,536 serviced apartments in Hong Kong, up 46.26 percent on last year, most of which will be in the Harbourfront Horizon Hotel and Harbourview Horizon Hotel. Some of those rooms are also likely to be used as hotel rooms.</FONT></P> <P align=justify><FONT color=#000000 size=3>Occupancy rates in serviced apartments in prime locations such as Four Seasons Place, the Atrium and Parkside are near 100 percent, according to Savill.</FONT></P> <P align=justify><FONT color=#000000 size=3>Bent, who is in his late 20s, said he and Nihalchand deliberately positioned their business away from the big developers.</FONT></P> <P align=justify><FONT color=#000000 size=3>He said that as a pair of younger developers they were aware of an accommodation need to service a younger clientele. </FONT></P> <P align=justify><FONT color=#000000 size=3>The older developers in Hong Kong "do very well," Bent said, "but we felt like we understand what these people, who are closer to our age, want."</FONT></P> <P align=justify><FONT color=#000000 size=3>The pair targeted young executives and business travelers aged between 25 and 40 from multinational companies, law firms, and financial companies.</FONT></P> <P align=justify><FONT color=#000000 size=3>"Hong Kong has no real boutique players," Bent said. "If you go to big cities in the United States, the boutique hotels there are much hipper, stylier. They are more about lifestyle and will cater to individuals in a fashionable way." </FONT></P> <P align=justify><FONT color=#000000 size=3>Kush Living derives from the English word "cushy" meaning comfortable. "We want to create a lifestyle brand through design and service," Bent said. "You can't stay in a hotel for a month and even if you could it can be very impersonal. We don't want to be hotel-like and we will offer warmer, more comfortable places, tailored to young expats." </FONT></P> <P align=justify><FONT color=#000000 size=3>Boutique serviced apartments are usually conveniently located with trendy, cozy and contemporary themes, such as the apartments run by Kush Living. Nihalchand and Bent have looked to every detail in their room designs and offer fashionable lighting and modern, well-appointed bathrooms in their three blocks of serviced apartments.<BR></FONT></P> <P align=justify><FONT color=#000000 size=3><FONT size=2>News from the Standard</FONT></P></FONT><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=237 2007-02-08 <![CDATA[Building review for Ho Man Tin district]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>The government is set to review building restrictions in Ho Man Tin after announcing a lower plot ratio for a coveted residential site in the district available on the application list of land sales.<BR>Developers will have less gross floor area to build if limits were to be imposed. </FONT></P> <P align=justify><FONT color=#000000 size=3>These include height restrictions and the plot ratio, which governs how many apartment units can be built on a site.</FONT></P> <P align=justify><FONT color=#000000 size=3>The government plans to review restrictions in all districts and has begun to impose height limits on projects in Kowloon Tong and Wong Chuk Hang on Island South. But the new restrictions have not been announced in all districts at the same time.</FONT></P> <P align=justify><FONT color=#000000 size=3>"The revision will be in the Ho Man Tin district," a government source told Sing Tao Daily, sister publication of The Standard.</FONT></P> <P align=justify><FONT color=#000000 size=3>Some developers are concerned over how their profit margins will be affected by a potential decline in the value of their property development sites in the districts. </FONT></P> <P align=justify><FONT color=#000000 size=3>Knight Frank executive director Alnwick Chan said unclear policy in respect to height limits applied to properties had also created difficulties in assessing the redevelopment value of older buildings and had impeded urban renewal.</FONT></P> <P align=justify><FONT color=#000000 size=3>The Lands Department recently announced a plot ratio of five for a residential site at the junction of Fat Kwong Street and Chung Hau Street in Ho Man Tin, the single most valuable site available on the government's application list of land sales.</FONT></P> <P align=justify><FONT color=#000000 size=3>The lower-than-expected plot ratio may reduce the value of the 1.62-hectare site by 30 percent to about HK$7 billion, surveyors said. <BR></FONT></P> <P>News from the Standard</P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=236 2007-02-06 <![CDATA[Cheung Kong aims for $14b in home sales]]> <font face='Arial, Helvetica, sans-serif'>Cheung Kong (Holdings) (0001) aims to rake in HK$14 billion from home sales this year as buying sentiment continues to improve, according to a company executive. <P align=justify><FONT color=#000000 size=3>The company, which topped the sales chart among major developers last year, plans to sell between 3,500 and 4,000 residential units this year, Cheung Kong executive director Justin Chiu Kwok-hung said Monday. </FONT></P> <P align=justify><FONT color=#000000 size=3>"The exact number of flats available will still depend on the progress of the government's sales consent of uncompleted flats," he added. </FONT></P> <P align=justify><FONT color=#000000 size=3>Expected sales revenue for this year is in line with last year's figures. </FONT></P> <P align=justify><FONT color=#000000 size=3>In January, the company sold 422 flats, earning HK$1.53 billion, Chiu said. </FONT></P> <P align=justify><FONT color=#000000 size=3>Most new home sales last month and this month were at its Crystal Cove project, the third phase of the Caribbean Coast development in Tung Chung, with 300 units sold for nearly HK$900 million. </FONT></P> <P align=justify><FONT color=#000000 size=3>Large-scale projects slated for sale later this year by Cheung Kong include Central Park Towers in Tin Shui Wai and Dream City Phase 1 in Tseung Kwan O. </FONT></P> <P align=justify><FONT color=#000000 size=3>Commenting on property market prospects, Chiu predicted home prices would rise by 10 percent this year, driven by a revival of the secondary residential market and continuing economic growth in Hong Kong. </FONT></P> <P align=justify><FONT color=#000000 size=3>Residential property sales showed signs of picking up in January when the value of apartment transactions surged 81.5 percent to HK$21.4 billion year on year, according to Land Registry figures. </FONT></P> <P align=justify><FONT color=#000000 size=3>Last month 7,485 units changed hands, up 52.8 percent from the same period last year when the market was hit by rising interest rates. </FONT></P> <P align=justify><FONT color=#000000 size=3>Real estate agents expect developers to speed up launches of new projects for sale this year to satisfy pent-up demand. <BR></FONT></P> <P align=justify><FONT color=#000000 size=3><FONT size=2>News from the Standard</FONT></P></FONT><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=235 2007-02-05 <![CDATA[BOCHK stays top in mortgage sector]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>Bank of China (Hong Kong) (2388) was again the leading lender in the home loan market last month, continuing its dominance for the fifth month in a row, according to a mortgage referral services provider.<BR>BOCHK grabbed a 16.8 percent slice of the residential mortgage market in January, followed by Hang Seng Bank (0011) with 12.6 percent, according to mReferral Mortgage Brokerage Services, a joint-venture between Midland Holdings (1200), Cheung Kong (Holdings) (0001) and American Express Bank. The service offers mortgage comparisons and makes referrals.</FONT></P> <P align=justify><FONT color=#000000 size=3>Hong Kong and Shanghai Banking Corp, a unit of HSBC Holdings (0005), was third with 11.9 percent of the market. BOCHK's market share last October was 17.2 percentage points higher than that of second-ranked HSBC.</FONT></P> <P align=justify><FONT color=#000000 size=3>mReferral's principal vice president Donald Cheng Wai-hung said the change in the market share of major banks has been significant. The market share difference between BOCHK and HSBC narrowed to 4.9 percentage points last month from 6.9 percentage points in December, Cheng said.</FONT></P> <P align=justify><FONT color=#000000 size=3>BOCHK's market share was only 4.2 percentage points higher than that of Hang Seng Bank last month.</FONT></P> <P align=justify><FONT color=#000000 size=3>Residential property sales rose 81.5 percent by value last month from a year earlier. Land Registry figures, released Friday, also showed that the HK$21.4 billion worth of transactions slipped 4.6 percent from December. </FONT></P> <P align=justify>News from the Standard</P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=234 2007-02-03 <![CDATA[Home sales surge in value amid upgrading]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>Residential property sales rose 81.5 percent by value last month from a year earlier.<BR>The Land Registry figures, released Friday, also showed that the HK$21.4 billion worth of transactions was 4.6 percent less than in December. </FONT></P> <P align=justify><FONT color=#000000 size=3>The number of units changing hands was 7,485, up 52.8 percent from last year when the market was hit by rising interest rates.</FONT></P> <P align=justify><FONT color=#000000 size=3>Agents attributed the mild increase to a revival of the resale market. Ricacorp Properties executive director Willy Liu Wai-keung has said secondary market sales would increase on pent-up demand from upgraders and steady interest rates.</FONT></P> <P align=justify><FONT color=#000000 size=3>Prices of mass-market properties may rise 6 percent this year and 8 percent in the next as the demand for new properties and housing completions are "in equilibrium," Merrill Lynch analysts Keith Yeung and Miranda Lai said last month. </FONT></P> <P align=justify><FONT color=#000000 size=3>For last year, residential transactions dropped more than 20 percent to 82,472 units from 103,362 in 2005.</FONT></P> <P align=justify><FONT color=#000000 size=3>Last month, sales of all building types, including industrial, commercial and residential properties, climbed 89.1 percent year over year to HK$27.2 billion, 4.4 percent less than December.</FONT></P> <P align=justify><FONT color=#000000 size=3>The total number of transactions was 8,807, an increase of 50.4 percent from January last year. The island had 2,255 transactions totaling HK$11.41 billion, while Kowloon had 2,528 deals involving HK$7.5 billion.</FONT></P> <P align=justify><FONT color=#000000 size=2>News from the Standard</FONT></P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=233 2007-02-02 <![CDATA[Owners see gold in old buildings]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>More and more owners of old buildings are expected to put their properties on the market to cash in on demand by developers for suitable land for redevelopment, according to real estate professionals.<BR>Latest figures compiled by Midland Realty show there were 20 sites launched for collective sale by tender in 2006, up 43 percent on the 14 rolled out in 2005.</FONT></P> <P align=justify><FONT color=#000000 size=3>Of the 20 sites, 15 were originally residential, four were industrial sites and one commercial. </FONT></P> <P align=justify><FONT color=#000000 size=3>These included sites such as Moonbeam Terrace at Kowloon Tong, Chi Lan Yuen in Kowloon City, and Heng Hin Mansion in Mid-Levels East in which K Wah International (0173) has a 92 percent ownership stake.</FONT></P> <P align=justify><FONT color=#000000 size=3>Earlier this month the Lands Tribunal granted an order for sale under the Land (Compulsory Sale for Redevelopment) Ordinance to K Wah allowing it to force an auction for the sale of one outstanding unit at Heng Hin Mansion.</FONT></P> <P align=justify><FONT color=#000000 size=3>By comparison, of the 14 sites in 2005, 12 were residential.</FONT></P> <P align=justify><FONT color=#000000 size=3>"Comparing the figures over the past two years, we can see residential projects are still in demand," said Midland VIP Investment associate director Lawden Au Yeung Hau-cheung.</FONT></P> <P align=justify><FONT color=#000000 size=3>Transaction figures for en-bloc sales also show a clear increase in 2006 with 136 deals compared with 96 in 2005 and 88 in 2004.</FONT></P> <P align=justify><FONT color=#000000 size=3>Au Yeung pointed out it has been 10 years since the last wave of buyouts for redevelopment by developers that fizzled out when the property market fell apart after 1997.</FONT></P> <P align=justify><FONT color=#000000 size=3>In the meantime, in 1999, the Land (Compulsory Sale for Redevelopment) Ordinance came into effect.</FONT></P> <P align=justify><FONT color=#000000 size=3>When the market recovered after 2004, and when owners became more familiar with the ordinance, they were more agreeable to sell.</FONT></P> <P align=justify><FONT color=#000000 size=3>Midland Surveyors director Alvin Lam Tze- pun said the latest wave of collective sales is being driven by two main factors.</FONT></P> <P align=justify><FONT color=#000000 size=3>First is prodding by the government with the compulsory sale ordinance going into effect and an ongoing blitz by the Buildings Department since 2000 to compel owners to carry out maintenance on their buildings.</FONT></P> <P align=justify><FONT color=#000000 size=3>Lam said more redevelopment motivation may have come from calls made in January at the Economic Summit on China's 11th Five-Year Plan for the government to review existing land policy to allow telecommunications companies to set up shop in vacant industrial premises.</FONT></P> <P align=justify><FONT color=#000000 size=3>The summit recommended the practice of charging land premiums for change of use should be replaced by payment of government rent.</FONT></P> <P align=justify><FONT color=#000000 size=3>The second major factor is supply and demand - developers are keen to replenish land banks on the back of increasing property transactions and aggressive prices as paid by developers at recent land auctions.</FONT></P> <P align=justify><FONT color=#000000 size=3>Lam also points to the limited number of new residential units being built in urban areas over the next three years.</FONT></P> <P align=justify><FONT color=#000000 size=3>For example, only 8,000 units are under construction in Kowloon compared with 29,000 in the New Territories. </FONT></P> <P align=justify><FONT color=#000000 size=3>For Hong Kong Island, the figure is a mere 4,000.</FONT></P> <P align=justify><FONT color=#000000 size=3>In view of the factors, Midland estimates that the number of sites launched for collective sale may jump by 50 percent while the number of completed deals could increase 20 percent. </FONT></P> <P align=justify><FONT color=#000000 size=3>Still, spare a thought for the surveyors handling these collective sales. </FONT></P> <P align=justify><FONT color=#000000 size=3>LCH (Asia-Pacific) Surveyors managing director Joseph Ho Chin-choi said he expects difficulties in realizing the sale of several properties his firm is handling.</FONT></P> <P align=justify><FONT color=#000000 size=3>"With the property market now going up, owners that originally may have agreed to sell are now suddenly demanding higher prices," Ho said.</FONT></P> <P align=justify><FONT color=#000000 size=3>Asked how many of the cases involved gazumping, he said all of them did.</FONT></P> <P align=justify><FONT color=#000000 size=3>"Every time there is an auction or there is a transaction nearby and [owners] feel the price has gone up, they will feel they have missed out," Ho added. One major difficulty is getting multiple signatures.</FONT></P> <P align=justify><FONT color=#000000 size=3>Another is that while the residential owners may agree to sell, shop unit owners could scupper deals.</FONT></P> <P align=justify><FONT color=#000000 size=3>"Some owners may think: `How can my shop be worth so little?"' Ho said.</FONT></P> <P align=justify><FONT color=#000000 size=3>Executive director Alnwick Chan Chi-hing of property consultant Knight Frank pointed out recently that collective sales faced statutory and administrative obstacles, especially "unclear policy" on height restrictions which has made it difficult to assess the redevelopment value of old buildings. </FONT></P> <P align=justify><FONT color=#000000 size=3>According to Knight Frank, government departments have reportedly slowed the approval of applications for lease modification in districts that are likely to face new restrictions on building heights.</FONT></P> <P align=justify><FONT color=#000000 size=3>That has not stopped some developers.</FONT></P> <P align=justify><FONT color=#000000 size=3>Last December, New World Development (0017) and its partner Hip Shing Hong bought 52 out of 60 units at New Eastern Terrace in Tin Hau while Chinese Estates (0127) bought the entire Sun Fair Mansion at Mid-Levels East and Sun Hung Kai Properties (0016) bought the whole of Manly Court in Prince Edward. </FONT></P> <P align=justify><FONT color=#000000 size=2>News from the Standard</FONT></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=232 2007-02-01 <![CDATA[Housing chief claims no shortage of land supply]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>Hong Kong's housing chief has dismissed concerns of a land shortage by saying potential residential land supply in Hong Kong over the next five years is expected to be 536 hectares, providing an estimated 139,000 flats. </FONT></P> <P align=justify><FONT color=#000000 size=3>But analysts said while the Secretary for Housing, Planning and Lands Michael Suen Ming-yeung's figures indicate there will be sufficient land for future housing developments, the exact supply is subject to the progress of land- conversion premium agreements and developers triggering land sales. </FONT></P> <P align=justify><FONT color=#000000 size=3>Under the current land application list system, a developer must bid a price that is at least 80 percent of the government's internal estimate for a site to be triggered for sale. <BR>Suen said at a Legislative Council question-and-answer session Wednesday the figures only refer to the possible maximum supply of residential sites, and the exact number is dependent on many factors. </FONT></P> <P align=justify><FONT color=#000000 size=3>"The exact supply is subject to market forces as well as the progress of land formation and land premium agreements. It would not be practical for us to provide an exact breakdown of the figures," Suen said. </FONT></P> <P align=justify><FONT color=#000000 size=3>Midland Realty chief analyst Buggle Lau Ka-fai said the figures indicate there is adequate land available, but it will take time for developers to complete their projects. </FONT></P> <P align=justify><FONT color=#000000 size=3>"It is difficult to predict when flats will come on line for presale," he said. </FONT></P> <P align=justify><FONT color=#000000 size=3>Hang Lung Properties (0101) chairman Ronnie Chan Chi-chung said the impact of the potential land supply on the real estate market could not be estimated as Suen did not provide a district breakdown of where the land would be. </FONT></P> <P align=justify><FONT color=#000000 size=3>Surveyors and developers have called for a resumption of regular land auctions as well as the present application list of land sales in order to meet growing demand as some developers are running out of residential land banks. Suen said there were still 26 hectares of residential sites available in the application list as of end December. </FONT></P> <P align=justify><FONT color=#000000 size=3>The government has sold five residential sites in Tsuen Wan, Lantau Island, Ma On Shan, Kowloon Tong and The Peak so far in the current fiscal year ending March 31. The remaining unsold sites could provide a total of 12,000 residential units. </FONT></P> <P align=justify><FONT color=#000000 size=3>Suen said the number of unsold inventory residential units and yet to be completed flats available for presale fell by 9.2 percent to 59,000 in the fourth quarter of 2006, from 65,000 in the third quarter. </FONT></P> <P align=justify><FONT color=#000000 size=3>Analysts said the existing flat supply is sufficient to meet demand in the next three years, given the average annual take-up of more than 20,000 new units over the past decade. </FONT></P> <P align=justify><FONT color=#000000 size=3>As of end 2006, the total area of residential sites where construction has not begun is 36 hectares. </FONT></P> <P>News from the Standard</P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=231 2007-01-29 <![CDATA[January home sales to rise 25pc]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>Improved investor sentiment and a revival in the secondary flats market will lift Hong Kong home sales this month by 25 percent month on month, industry observers said.</FONT></P> <P align=justify><FONT color=#000000 size=3>"Given the volatility in the stock market, more investors with spare money are switching their focus to the residential market," said Willy Liu Wai-keung, executive director of Ricacorp Properties.</FONT></P> <P align=justify><FONT color=#000000 size=3>Liu said the number of residential transactions this month, including primary and secondary markets, will jump to 7,500 units, compared with 6,000 units in December.</FONT></P> <P align=justify><FONT color=#000000 size=3>"Long-term and short-term investors account for 20 to 30 percent of total new apartment purchases this month, compared with the ratio of 10 to 20 percent in the previous month," he said.</FONT></P> <P align=justify><FONT color=#000000 size=3>Cheung Kong (Holdings) (0001) deputy chief manager for sales William Kwok Tsz-wai said so far there has not been any noticeable heavy buying by speculators at new projects.</FONT></P> <P align=justify><FONT color=#000000 size=3>He said he does not welcome speculators since their purchases do not accurately reflect the market, while their activities also make it difficult for the developer to gauge demand and set prices. </FONT></P> <P align=justify><FONT color=#000000 size=3>Liu said the number of residential sales in the primary market is likely to rise moderately to more than 1,000 this month compared with December.</FONT></P> <P align=justify><FONT color=#000000 size=3>"While in the secondary market, pent-up demand from upgraders and steady interest rates will help boost the volume of transactions by 20 to 30 percent month on month to about 6,500 units in January," he said.</FONT></P> <P align=justify><FONT color=#000000 size=3>Real-estate agents said market sentiment is likely to be underpinned by the auction in March of two coveted luxury residential plots in Tai Po. </FONT></P> <P align=justify><FONT color=#000000 size=3>The auction was recently triggered by K Wah International (0173) from the government's application list of land sales.</FONT></P> <P align=justify><FONT color=#000000 size=3>Hong Kong Property Services (Agency) executive director Lee Chi- shing expects new flats available for sale to climb more than half year on year to 22,000 units in 2007, as better sentiment will encourage developers to launch new projects.</FONT></P> <P align=justify><FONT color=#000000 size=3>Large-scale projects slated for sale this year include Hunghom Peninsula, Yoho Town Phase 2 in Yuen Long, Central Park Towers in Tin Shui Wai, and Dream City Phase 1 in Tseung Kwan O. </FONT></P> <P align=justify><FONT color=#000000 size=3>Meanwhile, Cheung Kong said it had sold about 200 flats at its 824-unit Crystal Cove project in Tung Chung, its first big project this year, since public sales started Friday night. </FONT></P> <P align=justify><FONT color=#000000 size=3>Company deputy chief manager for sales Joseph Lau Kai-man said 82 units were sold Friday, while another 63 were disposed of Saturday. </FONT></P> <P align=justify><FONT color=#000000 size=3>Selling prices were similar to those on the secondary market at between HK$2,580 and 2,950 per square foot .</FONT></P> <P align=justify><FONT color=#000000 size=3>Lau said any future price increases would depend on a review of final sales statistics for the weekend, but said he hopes to add an indicative 5-10 percent, to secure up to an average of HK$3,000 psf. </FONT></P> <P align=justify><FONT color=#000000 size=3>Last year, residential property transactions dropped more than 20 percent to 82,472 units, from 103,362 in 2005, according to Land Registry figures.</FONT></P> <P align=justify><FONT color=#000000 size=3>Agents attributed the fall to rising interest rates that discouraged home buyers in the first half of 2006.</FONT></P> <P align=justify><FONT color=#000000 size=3>January figures will be available when the Land Registry announces the home sales data early next month.</FONT></P> <P align=justify><FONT color=#000000 size=2>News from the Standard</FONT></P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=230 2007-01-26 <![CDATA[Flat owners allege property values dipped over repairs dispute]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>More than 1,800 owners of flats in a Home Ownership Scheme housing estate in Lam Tin claim the value of their properties fell up to 20 percent after the Housing Department informed the Land Registry last month the buildings needed repairs.</FONT></P> <P align=justify><FONT color=#000000 size=3>The department's action came on the heels of an order for the Hong Nga Court homeowners association to start repair work on the air-conditioning ledges of flats by March and have the work completed in three months.</FONT></P> <P align=justify><FONT color=#000000 size=3>"I was almost tempted to buy another flat following the drop in value," joked a flat owner who only wished to identify herself as Mrs Lau.</FONT></P> <P align=justify><FONT color=#000000 size=3>The problem of defective air-conditioning vents and ledges goes back to 1999 when owners first complained about concrete disintegrating.</FONT></P> <P align=justify><FONT color=#000000 size=3>In 2003, the homeowners association hired engineers to inspect all three blocks in the estate, built in 1993. Owners then turned to the department seeking compensation under the 10-year structural guarantee. However, their claim was rejected and problems worsened.</FONT></P> <P align=justify><FONT color=#000000 size=3>After years of disputes and mediation, the department finally agreed to pay HK$4.4 million as compensation but owners could not agree on hiring contractors or how to share the balance of the repair costs. The department's Independent Checking Unit ordered the flat owners in December to start maintenance work by mid-March and that the work be completed in three months.</FONT></P> <P align=justify><FONT color=#000000 size=3>The department also used a legal procedure which, in effect, means property owners would have to inform would-be buyers of possible liability over repairs. In its wake, the value of the 1,824 flats in the estate fell.</FONT></P> <P align=justify><FONT color=#000000 size=3>A Housing Department spokesman said owners could be prosecuted for not doing the repairs. Housing Authority member Wong Kwan said the government had the authority to hire contractors to do the work and then demand repayment of costs.</FONT></P> <P align=justify><FONT color=#000000 size=3>"It could be seen as government's ultimate weapon to cope with homeowners who ignore and do not repair their buildings when ordered to do so," he said.<BR></FONT></P> <P align=justify><FONT color=#000000 size=3><FONT size=2>News from the Standard</FONT></P></FONT><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=229 2007-01-25 <![CDATA[Toy tycoon sells Hacienda for a billion]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>Toy tycoon Francis Choi Chee-ming has sold a luxury property in Island South to a locally listed property firm for HK$1 billion ahead of the private tender deadline this weekend.</FONT></P> <P align=justify><FONT color=#000000 size=3>The sale of the Hacienda development, located at 90 Repulse Bay Road, reflected robust demand for luxury residential properties in Hong Kong where supply is limited, analysts said.</FONT></P> <P align=justify><FONT color=#000000 size=3>Choi, who is chairman of Early Light International Holdings, confirmed the deal Wednesday with Sing Tao Daily, sister paper of The Standard.</FONT></P> <P align=justify><FONT color=#000000 size=3>Choi declined to identify the buyer, but sources said the buyer is a listed real estate company.</FONT></P> <P align=justify><FONT color=#000000 size=3>In 2002, Early Light bought the then 15-year- old property from Sino Land (0083) for HK$450 million. The four-story low-rise development comprises 33 residential units. </FONT></P> <P align=justify><FONT color=#000000 size=2>News from the Standard</FONT></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=228 2007-01-24 <![CDATA[Rents expected to rise as lower mortgage rates attract investors]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>Rents in the mass residential market are set to jump by at least 15 percent as negative interest rates encourage more investors to buy properties with the purpose of renting them out to earn an income.<BR>Real Estate Agent said rentals have been rising in recent years as owners revise upwards when leases are renewed.</FONT></P> <P align=justify><FONT color=#000000 size=3>"But mortgage rates are lower, so mortgage payments are cheaper than rent again," he said. Taking eight large housing estates as an example, and assuming a property had a 70 percent mortgage with a 20-year repayment period at a rate of 4.82 percent, the rents charged would be sufficient to cover mortgage repayments, he said. </FONT></P> <P align=justify><FONT color=#000000 size=3>At Golden Lion Garden, for example, the average sale price is HK$1,746 per square foot, while rent is charged at HK$9 psf. This means the mortgage repayment will be 11.7 percent less than the monthly rental. </FONT></P> <P align=justify><FONT color=#000000 size=3>At Tsuen Wan Centre, this difference is 11.2 percent while at City One, Sha Tin, it is 3percent. </FONT></P> <P align=justify><FONT color=#000000 size=3>Taking these factors into consideration, he expects residential rents to rise by at least 15 percent in 2007, with transaction volume in the first quarter for Kowloon and New Territories increasing by more than 20 percent quarter-on- quarter. </FONT></P> <P align=justify><FONT color=#000000 size=3>According to government statistics released Monday, Hong Kong's composite consumer price index climbed 2.3 percent in December from a year ago, driven by increases in food and housing rental costs. </FONT></P> <P align=justify><FONT color=#000000 size=3>Real Estate Agent said over the past two years rents have risen 13.7 percent, outpacing the 5.9 percent increase in prices at 50 large housing estates. </FONT></P> <P align=justify><FONT color=#000000 size=3>He said rental increases have been most apparent in Kowloon and New Territories with Kingswood Villas in Yuen Long seeing a 16.7 percent increase in rent to HK$7 psf compared with a year ago. </FONT></P> <P>News from the Standard</P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=227 2007-01-23 <![CDATA[Demand a factor as stocks of flats fall]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>Improving demand and fewer new projects have contributed to a decline in the private housing stock in Hong Kong. </FONT></P> <P align=justify><FONT color=#000000 size=3>The number of unsold inventory units and uncompleted flats for presale fell by 9.2 percent to 59,000 in the fourth quarter from 65,000 the previous quarter, according to figures released Friday by the Housing Department. </FONT></P> <P align=justify><FONT color=#000000 size=3>In the fourth quarter, there were 19,000 unsold newly completed flats and 40,000 uncompleted flats coming on stream for pre-sale, figures show. </FONT></P> <P align=justify><FONT color=#000000 size=3>This compares with 19,000 backlog homes and 46,000 units still under construction in the third quarter. After receiving the government's presale consent, developers can put flats on the market 20 months ahead of completion. </FONT></P> <P align=justify><FONT color=#000000 size=3>Midland Realty chief analyst Buggle Lau Ka-fai said the moderate drop in available housing was partly because there had been an improvement in buying sentiment in the fourth quarter as interest rates stabilized. </FONT></P> <P align=justify><FONT color=#000000 size=3>"Some uncompleted flats were taken up by buyers during the quarter," Lau said, adding that supply was still adequate to meet demand for the next three years. </FONT></P> <P align=justify><FONT color=#000000 size=3>He described the December figures as being "not below the average annual take-up of between 20,000 and 25,000 new units over the past decade." </FONT></P> <P align=justify><FONT color=#000000 size=3>Government figures, meanwhile, showed the number of units beginning construction fell nearly 76 percent to 1,400 in the fourth quarter from 5,800 the previous quarter. Industry watchers said these data also depend on the progress of consents given by the Buildings Department to start work. </FONT></P> <P align=justify><FONT color=#000000 size=3>In the fourth quarter, large-scale housing projects available for presale included Sausalito in Ma On Shan, being developed by Cheung Kong (Holdings) (0001), and Sun Hung Kai Properties' (0016) Manhattan Hill in Lai Chi Kok.</FONT></P> <P align=justify><FONT color=#000000 size=3>Ricacorp Properties said more than 18,000 new apartments, valued at about HK$120 billion, will come on the market this year. Most of the upcoming projects for sale are still being built, including Hunghom Peninsula, YOHO Town Phase 2 in Yuen Long, Central Park Towers in Tin Shui Wai and Dream City Phase 1 in Tseung Kwan O. </FONT></P> <P align=justify><FONT color=#000000 size=3>In 2006, the number of new apartments put up for sale fell for the fourth consecutive year to about 14,000 units, as some developers sat tight on project launches in the first half, amid rising interest rates, Ricacorp said. The realtor expects steady interest rates to help boost market sentiment and encourage developers to roll out new projects this year. </FONT></P> <P align=justify><FONT color=#000000 size=3>Hong Kong Property Services (Agency) executive director Lee Chi- shing expects new flats available for sale to climb more than half year-on- year to 22,000 units in 2007.</FONT> <BR></P> <P align=justify>News from the Standard</P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=226 2007-01-19 <![CDATA[Buildings could still be history]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>Companies seeking to redevelop old properties are unlikely to lose too much sleep over a government move to seek a consensus on protecting historical buildings and its issuance of a list of graded buildings for discussion.<BR>Last week, on the heels of a recent heated public debate on retaining the Central Star Ferry pier, the issue of heritage conservation shifted to a higher gear as the Home Affairs Bureau announced another series of consultations with a view to allowing greater public participation. </FONT></P> <P align=justify><FONT color=#000000 size=3>The government also released a list of 496 buildings that have been rated.</FONT></P> <P align=justify><FONT color=#000000 size=3>It said that, apart from factors like architectural design and historical significance, the collective memory of the public should also be considered when assessing whether a building is worth retaining.</FONT></P> <P align=justify><FONT color=#000000 size=3>The sheer number of buildings - nearly 500 - on the government's list might lead people to think there would be severe obstacles to redevelopment. But a closer looks shows that a great many are government buildings and structures.</FONT></P> <P align=justify><FONT color=#000000 size=3>For example, there are 64 reservoir-related buildings and structures on the list like the Tai Tam Reservoir Dam rated Grade I, meaning it is a building of outstanding merit to be preserved at all costs.</FONT></P> <P align=justify><FONT color=#000000 size=3>Curiously, a drainage structure such as the Pok Fu Lam Reservoir Box Culvert is rated Grade II, meaning it has special merit and should be preserved with some allowance for discretion.</FONT></P> <P align=justify><FONT color=#000000 size=3>Grade III buildings have some merit but do not qualify yet for consideration as possible monuments.</FONT></P> <P align=justify><FONT color=#000000 size=3>A building that has been declared a monument is protected by law from demolition and alteration.</FONT></P> <P align=justify><FONT color=#000000 size=3>Military-related buildings like former British forces barracks alone number 73.</FONT></P> <P align=justify><FONT color=#000000 size=3>For non-government buildings, there are 84 Chinese temples and 18 churches and chapels.</FONT></P> <P align=justify><FONT color=#000000 size=3>Private buildings of possible interest for redevelopment number only 45, with most concentrated in Sham Shui Po, Wan Chai and Mong Kok.</FONT></P> <P align=justify><FONT color=#000000 size=3>For example, several old buildings in Shanghai Street in Mong Kok immediately north of Langham Place, and at Stone Nullah Lane in Wan Chai have been rated Grade I.</FONT></P> <P align=justify><FONT color=#000000 size=3>By comparison, the Pedder Building on Pedder Street in Central has been rated Grade II, the same as a group of old buildings on Mallory Street and Burrows Street in Wan Chai.</FONT></P> <P align=justify><FONT color=#000000 size=3>Some of the private buildings, in fact, are now the property of the Urban Renewal Authority, including 18 Ship Street, which has been incorporated into the K Wah International (0173) J-Residence project currently under construction.</FONT></P> <P align=justify><FONT color=#000000 size=3>Another three Grade II buildings, at 186 to 190 Queen's Road East, were incorporated into an application last month to the Town Planning Board for the URA's comprehensive development at Lee Tung Street and Macgregor Street.</FONT></P> <P align=justify><FONT color=#000000 size=3>LCH (Asia-Pacific) Surveyors managing director Joseph Ho Chin-choi said a few small developers contacted him for advice. </FONT></P> <P align=justify><FONT color=#000000 size=3>"The announcement is not legally binding," Ho advised them. "It's only a consultation period. If you're doing [land] assembly, then continue doing it." </FONT></P> <P align=justify><FONT color=#000000 size=3>Developers are unlikely to be unduly worried. "There's not much effect on them," Ho said.</FONT></P> <P align=justify><FONT color=#000000 size=3>"If anything, the government's plan is likely to cause developers to speed up applications for demolition permits."</FONT></P> <P align=justify><FONT color=#000000 size=3>In the absence of a government commitment to spend public money to buy the buildings, a private developer owning a graded building would prefer redevelopment unless it had strong conservation tendencies. </FONT></P> <P align=justify><FONT color=#000000 size=3>"Otherwise, I will demolish it; you cannot stop me," Ho said.</FONT></P> <P align=justify><FONT color=#000000 size=3>What is more worrying for developers is if the government amends zoning pertaining to a building to "government, institution or community," to protect it from hasty demolition.</FONT></P> <P align=justify><FONT color=#000000 size=3>"That would then be a serious matter. Because if rezoned, even if I want to demolish a building and build something else, the Town Planning Board will not allow me to do it," Ho said. </FONT></P> <P align=justify><FONT color=#000000 size=3>Developers would also be concerned at possible cuts in plot ratios and height restrictions.</FONT></P> <P align=justify><FONT color=#000000 size=3>However, the government has not done this in tandem with the announcement of its graded building list.</FONT></P> <P align=justify><FONT color=#000000 size=3>"I reckon the government will not have the nerve to do this," Ho said.</FONT></P> <P align=justify><FONT color=#000000 size=3>He agreed that, at least for URA projects, developers can leave the tricky business of graded buildings to the authority to do all the land assembly, design and planning applications, while developers wait for the green light to tender.</FONT></P> <P align=justify><FONT color=#000000 size=3>Still, he said, developers would need to allow for political factors relating to graded buildings within their development plans. </FONT></P> <P align=justify><FONT color=#000000 size=3>Midland Surveyors director Alvin Lam Tze- pun said if developers have unknowingly bought a graded building they might need to retain its special characteristics.</FONT></P> <P align=justify><FONT color=#000000 size=3>Having to deal with heritage buildings need not be all negative, though. </FONT></P> <P align=justify><FONT color=#000000 size=3>"It can't be ruled out that it may be good for adjacent new developments.</FONT></P> <P align=justify><FONT color=#000000 size=3>"If it is upgraded and has sentimental value, then it could improve tourism and improve the city's appearance," Lam said. </FONT></P> <P>News from the Standard</P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=225 2007-01-17 <![CDATA[HOS flats in high demand]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy><FONT color=#000000 size=3>Demand has outstripped the supply of Home Ownership Scheme flats which have now come on stream, with the 3,056 HOS flats on offer being 3.6 times oversubscribed. </FONT> <P align=justify><FONT color=#000000 size=3>The response defied market expectations of a just-fully-subscribed situation, despite the fact that the government said the enthusiastic reception was within its expectations. </FONT> <P align=justify><FONT color=#000000 size=3>A spokeswoman for the Housing Authority said about 14,000 applications have been received for the resumption of sales of HOS flats at Kingsford Terrace Stage I in Ngau Chi Wan, Yu Chui Court in Sha Tin and Tin Fu Court in Tin Shui Wai. </FONT> <P align=justify><FONT color=#000000 size=3>Thirty percent of the applications have been submitted by public rental housing tenants using green forms. </FONT> <P align=justify><FONT color=#000000 size=3>The remainder are households that qualify based on income criteria, who handed in applications using white forms. Those who have submitted applications will be chosen in a ballot next month and will be able to pick their flats in March. </FONT> <P align=justify><FONT color=#000000 size=3>Midland Realty chief analyst Buggle Lau Ka-fai expects that the HOS flats available, especially those closer to city areas, could well be snapped up in a surge of pent-up demand. </FONT> <P align=justify><FONT color=#000000 size=3>"Some potential buyers, particularly public rental housing tenants, have been waiting for the sales for more than four years," Lau said. </FONT> <P align=justify><FONT color=#000000 size=3>Stronger interest from eligible households also reflects sustained demand for the government's subsidized flats, he added. </FONT> <P align=justify><FONT color=#000000 size=3>"However, the probability of those households securing the flats will be less due to limited quotas," he said. </FONT> <P align=justify><FONT color=#000000 size=3>Twenty percent of units in the HOS flats have been set aside for eligible households while the remainder will be taken up by tenants. </FONT> <P align=justify><FONT color=#000000 size=3>The government is resuming the sale of the first batch of 3,056 HOS flats following a suspension lasting more than four years which was intended to stabilize slumping home prices. </FONT> <P align=justify><FONT color=#000000 size=3>The HOS flats on offer are priced between HK$563,000 and HK$1,896,700 each, or HK$1,010 to HK$2,420 per square foot. </FONT> <P align=justify><FONT color=#000000 size=3>The price represents a 30 percent discount, accounting for the fact that they are among the 16,641 HOS flats that have been left vacant for several years, the government said. </FONT> <P align=justify><FONT color=#000000 size=3>The government plans to launch the next batch of 3,243 HOS flats in the middle of the year although the price has yet to be determined. </FONT> <P>News from the Standard</SPAN></P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=224 2007-01-12 <![CDATA[Home buyers spoilt for choice]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy><FONT color=#000000 size=3>Urban development and railway land projects will provide plenty of flats </FONT> <P align=justify><FONT color=#000000 size=3>Home buyers will be spoilt for choice this year as a raft of railway property projects and urban redevelopment projects are expected to hit the market. </FONT> <P align=justify><FONT color=#000000 size=3>According to recent research by Ricacorp Properties, four projects being developed on MTR Corp (0066) property with a total potential supply of 3,776 flats may be released for sale this year. </FONT> <P align=justify><FONT color=#000000 size=3>They are the Kowloon Station project phases 5 and 6 in West Kowloon (800 units) being developed by Sun Hung Kai Properties (0016), Dream City phase 1 at Tseung Kwan O (2,096 units), Caribbean Coast phase 4 (824 units) and Caribbean Coast villas (56 units) at Tung Chung being built by Cheung Kong (Holdings) (0001). </FONT> <P align=justify><FONT color=#000000 size=3>The Kowloon-Canton Railway Corp (2566) is expected to roll out two large projects with total potential supply of 3,300 units. </FONT> <P align=justify><FONT color=#000000 size=3>They are the Ho Tung Lau project by Sino Land (0083) near Fo Tan station (1,023 units) and its Wu Kai Sha project in Ma On Shan (2,277 units). </FONT> <P align=justify><FONT color=#000000 size=3>By comparison, there was only one railway related property development released for sale in 2006: Le Point in Tseung Kwan O developed by Cheung Kong. </FONT> <P align=justify><FONT color=#000000 size=3>Potentially, however, there might have been a lot more in 2007. </FONT> <P align=justify><FONT color=#000000 size=3>In October 2003, the government announced measures to support the property market which included further liaison with the railway corporations on the pace and timing of tendering out their property developments. </FONT> <P align=justify><FONT color=#000000 size=3>As a result the KCRC agreed to carry out in phases the construction of 7,200 flats at Tai Wai maintenance center and Tai Wai station on the Ma On Shan rail system with the first batch to be completed no earlier than 2008. </FONT> <P align=justify><FONT color=#000000 size=3>The government also reviewed West Rail property projects. </FONT> <P align=justify><FONT color=#000000 size=3>Developers with projects near MTR stations have plugged the convenient commuting factor. </FONT> <P align=justify><FONT color=#000000 size=3>Cheung Kong has been taking reservations from buyers for its 108-unit CASA 880 project at 880 King's Road near the office area of Taikoo Place, about a minute's walk from Quarry Bay MTR station. </FONT> <P align=justify><FONT color=#000000 size=3>"It is really a subway-related concept," said Cheung Kong senior sales manager Kenneth Yuen Tim-hung. </FONT> <P align=justify><FONT color=#000000 size=3>Buyers who prefer properties in the urban areas can choose from nine sites being redeveloped by developers in partnership with the Urban Renewal Authority with a potential total supply of 2,321 units. </FONT> <P align=justify><FONT color=#000000 size=3>Among the largest are 14-24 Second Street at Sheung Wan (470 units) by Kerry Properties (0683), the New World Development (0017) Hanoi Road project in Tsim Sha Tsui (383 units), and private developer Nan Fung's Cherry Street project in Tai Kok Tsui (522 units). </FONT> <P align=justify><FONT color=#000000 size=3>Smaller URA projects include two at Bedford Road and one in Reclamation Street at Tai Kok Tsui being developed by Chinese Estates Holdings (0127) and Sun Hung Kai, two in Sham Shui Po at Fuk Wing Street and Po On Road being developed by Sino Land and Sun Hung Kai, and Vision City phase 2 also by Sino Land. </FONT> <P align=justify><FONT color=#000000 size=3>Ricacorp executive director Willy Liu Wai- keung does not agree that buyers will make a beeline for the MTR and KCR projects just because they are close to railways. </FONT> <P align=justify><FONT color=#000000 size=3>"It just so happens that in 2007 there are a few more of these projects," he said. </FONT> <P align=justify><FONT color=#000000 size=3>Market reaction to the projects will depend on quality of build, and demand from buyers. </FONT> <P align=justify><FONT color=#000000 size=3>The URA projects with their advantage of being in built-up areas are not regarded as a threat to the railway projects. </FONT> <P align=justify><FONT color=#000000 size=3>"In good times, one month can experience 2,000 to 3,000 [primary market] sales," Liu said. </FONT> <P align=justify><FONT color=#000000 size=3>These private-sector projects will have to contend with competition from the resumption of surplus Home Ownership Scheme flats by the Hong Kong Housing Authority. </FONT> <P align=justify><FONT color=#000000 size=3>The authority is looking to sell 3,056 flats in the early part of this year at prices 30 percent below market values. </FONT> <P align=justify><FONT color=#000000 size=3>Liu believes such homes are for an altogether different market, that for the first-time buyer. </FONT> <P align=justify><FONT color=#000000 size=3>"The direct competition to the new [railway] flats is not strong because the new [railway] flats pay attention to packaging and quality. HOS flats quality is lower and the price is cheaper," Liu said. </FONT> <P align=justify><FONT color=#000000 size=3>Midland Realty chief analyst Buggle Lau Ka- fai believes there will be some effect on the private residential market, especially the market for small and mid-sized flats. </FONT> <P align=justify><FONT color=#000000 size=3>Private flat supply in the New Territories may be affected more than in the urban areas where HOS supply is limited. </FONT> <P align=justify><FONT color=#000000 size=3>Liu expects Kowloon Station project phases 5 and 6, Dream City phase 1, Ho Tung Lau, and Wu Kai Sha to be among the top 10 projects that will be the focus of the market in 2007. </FONT> <P align=justify><FONT color=#000000 size=3>Among the remaining non-railway related projects are Bel-Air phase 6 in Cyberport, Hung Hom Peninsula, YOHO Town phase 2, and The Vineyard. </FONT> <P>News from the Standard</SPAN></P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=223 2007-01-11 <![CDATA[Real estate reins loosened]]> <font face='Arial, Helvetica, sans-serif'><TABLE border=0 cellSpacing=0 cellPadding=0 width=740> <TBODY> <TR> <TD bgColor=#ffffff vAlign=top width="100%"> <TABLE border=0 cellSpacing=10 cellPadding=0 width="100%"> <TBODY> <TR> <TD> <P align=justify><FONT color=#000000 size=3>Mainland property stocks bucked the trend of Hong Kong's volatile stock market, thanks to Beijing's intention to relax rules requiring developers to build mostly smaller flats in projects following pressure from the industry.<BR>The real estate industry welcomed the revision of the rules because easing restrictions on building units will enable developers to be more flexible over flat- size design, given the varying market demand in mainland cities.</FONT></P> <P align=justify><FONT color=#000000 size=3>Guangzhou R&amp;F Properties (2777), one of China's largest developers specializing in the medium and higher- end property market, had earlier expressed concern over the flat-size guidelines, saying some developers may find it difficult to follow the rules on low-density sites.</FONT></P> <P align=justify><FONT color=#000000 size=3>R&amp;F shares jumped nearly 4 percent to close at HK$16.08 Wednesday, while Shimao Property Holdings (0813) climbed 2.4 percent to HK$13. Hopson Development Holdings (0754) rose 1.1 percent to HK$18.80. However, hit by weak sentiment in the region Wednesday, the Hang Seng Index dropped 329.74 points overall, or 1.66 percent, to close at 19,568.34.</FONT></P> <P align=justify><FONT color=#000000 size=3>The Ministry of Construction is consulting the public over the flat-size rule which is part of the central government's latest round of measures implemented last June aimed at cooling the overheated real estate market. </FONT></P> <P align=justify><FONT color=#000000 size=3>Under the guidelines, all local authorities are required to ensure that 70 percent of units built are no larger than 90 square meters, and to ensure there is adequate housing in the low- to middle- income range. The mainland authorities intend to relax the flat-size standard to 107 sqm in some cities, slightly lower than the suggestion by some developers of 110 sqm each.</FONT></P> <P align=justify><FONT color=#000000 size=3>Real estate agents said the flat-size guidelines seem to be inadequate nationwide because some local authorities did not strictly follow the policy. "Amid a lower demand for small flats in some cities where people get used to living in larger apartments, the regulations may hamper developers' desire to buy land," said Clement Luk, director and deputy general manager of Centaline (China) Property Consultants.</FONT></P> <P align=justify><FONT color=#000000 size=3>"Once the regulations are eased, developers will be more flexible over the design of flat sizes in projects based on market demand." </FONT></P> <P align=justify><FONT color=#000000 size=3>He said that easing the flat-size rules would help balance supply and stabilize home prices nationwide.</FONT></P> <P align=justify>News from the Standard</P><!-------- End Content --------------------------></TD></TR></TBODY></TABLE></TD><!--- Right ----------------------------><!--- End Right ----------------------------> <TD bgColor=#3d3d3d width=1><IMG src="http://www.bestfortune.com.hk/images/top-10.gif" width=1 height=21></TD></TR></TBODY></TABLE><!--- Footer ----------------------------> <TABLE border=0 cellSpacing=0 cellPadding=0 width=740> <TBODY> <TR> <TD bgColor=#3d3d3d><IMG src="http://www.bestfortune.com.hk/all_layout/layout30/images/top-10.gif" width=1 height=1></TD></TR></TBODY></TABLE></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=222 2007-01-09 <![CDATA[Henderson aims at $10b sales for 2007]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>Henderson Land Development (0012) is hoping to sell about 2,000 new residential units and break through the HK$10 billion mark for revenue in 2007. <BR>Company general manager for sales Tony Tse Wai-chuen said if the 500 or so inventory flats are included then the total units for sale in 2007 would be nearly the same as for 2006.</FONT></P> <P align=justify><FONT color=#000000 size=3>Tse said the company sold about 2,600 residential units in 2006, generating revenue of more than HK$8.5 billion. </FONT></P> <P align=justify><FONT color=#000000 size=3>When the figures from external sales agents are included, units sold total 2,700 with revenue of about HK$9 billion.</FONT></P> <P align=justify><FONT color=#000000 size=3>Asked how much revenue the company was looking to generate in 2007, Tse said: "Our target is to be over HK$10 billion."</FONT></P> <P align=justify><FONT color=#000000 size=3>Among the projects due for sale are the Tung Chau Street project in Cheung Sha Wan (about 400 units), the Sycamore Street project in Tai Kok Tsui (400 units), the Tak Hing Street project in Jordan (fewer than 100 units), the Tong Yan San Tsuen project in Yuen Long (60 units) and the Tan Kwai Tsuen project in Yuen Long (119 units).</FONT></P> <P align=justify><FONT color=#000000 size=3>The sales schedule will include high-end houses at The Beverly Hills in Tai Po with a total of 535 villas. </FONT></P> <P align=justify><FONT color=#000000 size=3>The company is currently doing pre- marketing for The Beverly Hills and brought in the 2005 Miss Universe, Natalie Glebova, to help promote the project Monday. </FONT></P> <P align=justify><FONT color=#000000 size=3>Tse declined to reveal the number of units reserved by its preferred customers at The Beverly Hills but said it was "in double digits." Henderson sales department deputy manager Thomas Lam Tat-man said public sales would start "anytime after this week."</FONT></P> <P align=justify><FONT color=#000000 size=3>The company is looking to release for sale an initial run of 25 out of 50 units at prices between HK$5,000 and HK$9,000 per square foot. </FONT></P> <P align=justify><FONT color=#000000 size=3>The company still has about 500 inventory flats at its 1,782-unit Grand Waterfront project at To Kwa Wan. </FONT></P> <P align=justify><FONT color=#000000 size=3>Recent statistics from Centaline Property Agency show Cheung Kong (Holdings) (0001) and Sun Hung Kai Properties (0016) together grabbed 44.7 percent of primary market sales in the first 11 months of 2006 with a combined total of 5,448 units and a total consideration of HK$19.54 billion. </FONT></P> <P align=justify><FONT color=#000000 size=3>Henderson came third with 1,914 units while Sino Land (0083) sold 662.</FONT></P> <P align=justify><FONT color=#000000 size=2>News from the Standard</FONT></P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=221 2007-01-07 <![CDATA[Investors hot for Grade A offices]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy><FONT color=#000000 size=3>The investment market remained active last year, with total consideration for transactions worth more than HK$100 million rising 3 percent to more than HK$54.2 billion year on year, according to a report. </FONT> <P align=justify><FONT color=#000000 size=3>A total of 167 transactions worth more than HK$100 million each were recorded across all property sectors in 2006, up 4 percent on the total in 2005, real-estate consultancy CB Richard Ellis said. </FONT> <P align=justify><FONT color=#000000 size=3>Out of this, local investors accounted for 77 percent of the total value, with the remaining 23 percent of investment from foreign investors, the consultancy said. </FONT> <P align=justify><FONT color=#000000 size=3>The office sector accounted for about 39 percent, while the residential sector accounted for 20 percent, with the rest in the retail, hotel, industrial and development site sectors. </FONT> <P align=justify><FONT color=#000000 size=3>The positive investment-market sentiment and optimistic outlook led to a high level of investment activity across all sectors, underpinning the robust performance of the investment market in the first half of 2006, the consultancy said. </FONT> <P align=justify><FONT color=#000000 size=3>Despite the absence of major acquisitions of whole-building prime office properties in the second half, the market saw upbeat floor-by-floor or strata-title activity, including the entire 20th floor of Convention Plaza in Wan Chai, which sold for HK$180 million, it said. </FONT> <P align=justify><FONT color=#000000 size=3>The luxury residential sector benefited from the rising local stock market, which continued to test all-time highs, resulting in an increase in liquidity. </FONT> <P align=justify><FONT color=#000000 size=3>Meanwhile, interest in and demand for industrial properties persisted, with several entire-block transactions throughout the year. </FONT> <P align=justify><FONT color=#000000 size=3>Henry Lam, CB Richard Ellis executive director of investment properties, Hong Kong, said investor sentiment, buoyed by signals from the Federal Reserve Board which suggested a calming of the US interest rate hike cycle, is expected to remain generally positive in 2007 as a clearer picture of the carrying costs of Hong Kong property emerges. </FONT> <P align=justify><FONT color=#000000 size=3>In the first half of last year, Hong Kong's major institutional investment deals focused on entire commercial buildings. Hang Seng Building in Central was acquired by a group comprising Morgan Stanley Real Estate Fund, Pamfleet (HK) and Pioneer Global Group for about HK$2.25 billion. </FONT> <P align=justify><FONT color=#000000 size=3>In May, Macquarie Global Property Advisors acquired the Low Block of Grand Millennium Plaza in Central sold for HK$2.38 billion. This marked the Australian-based fund's second Hong Kong purchase in as many months. </FONT> <P align=justify><FONT color=#000000 size=3>In March, the fund - one of a group of foreign investors buying up local office towers - purchased Vicwood Plaza in Central from Morgan Stanley for about HK$2.6 billion. </FONT> <P align=justify><FONT color=#000000 size=3>Morgan Stanley and Pamfleet bought DBS Building in Central for about HK$655 million in March. </FONT> <P align=justify><FONT color=#000000 size=3>The largest deal by a Hong Kong-listed developer was Swire's HK$6.18 billion purchase of 50 percent of the Festival Walk shopping mall in Kowloon Tong in January. </FONT> <P align=justify><FONT color=#000000 size=3>In June, Capital Strategic Investment bought the major portion of AXA Centre, an office building in Wan Chai, for HK$780 million. </FONT> <P align=justify><FONT color=#000000 size=3>DTZ Debenham Tie Leung executive director Francis Li said that, of all property investment sectors last year, offices were the most coveted with HK$18.5 billion worth of properties sold in 72 transactions (each with a minimum value of HK$50 million), giving an increase of 23 percent in value and a decrease of 21 percent in numbers compared with 2005. </FONT> <P align=justify><FONT color=#000000 size=3>"That the number of transactions and the total consideration went in opposite directions is mainly due to the good number of Grade-A entire-block offices being sold," he said. </FONT> <P align=justify><FONT color=#000000 size=3>As a result of keen buying, the value of office transactions as a proportion of total property investment increased to 34 percent, up nine percentage points from 2005, which was in line with the real estate consultancy's forecast. "As we expected, market attention shifted to office properties last year, given the strong 25 percent rental growth of Grade-A offices in Central," he said. </FONT> <P align=justify><FONT color=#000000 size=3>Current low vacancy levels and limited supply, especially in Central, coupled with robust demand for quality office space from tenants who are looking to expand or set up regional headquarters in Hong Kong combine to paint a rosy picture for investors and for funds in particular, he added. </FONT> <P align=justify><FONT color=#000000 size=3>Grade-A offices promise long-term appreciating rental returns. </FONT> <P align=justify><FONT color=#000000 size=3>The luxury residential sector was the second- best performer in terms of investment transaction value last year, with HK$14.1 billion worth of properties sold in 121 transactions, down 24 percent by value and 14 percent by number of transactions from 2005. </FONT> <P align=justify><FONT color=#000000 size=3>The sector's share of total investment value fell to 26 percent, 4.5 percentage points lower compared with 2005, the consultancy said. Buying interest in retail and industrial properties also declined, with their transaction values in the first 11 months of 2006 totaling HK$11.8 billion and HK$4.9 billion, respectively, a decrease of 17 percent and 43 percent compared with 2005. The number of transactions fell 43 percent and 20 percent to 63 and 32, respectively. </FONT> <P align=justify><FONT color=#000000 size=3>Commenting on the overall performance of property investment, Li said the market was still considered active last year, with substantial purchases by investment funds. </FONT> <P align=justify><FONT color=#000000 size=3>In the first 11 months of 2006, funds spent a total of HK$11.463 billion on property investment, twice as much as in 2005. Their share of total property investment increased from 9 percent in 2005 to 21 percent in 2006. The number of transactions conducted by funds also increased, from four in 2004 to 11 in 2005 and 19 in 2006. These figures indicate that funds' interest in local properties is growing, adding impetus and buoyancy to the market, Li said. </FONT> <P align=justify><FONT color=#000000 size=3>The office sector has overtaken industrial as the most appealing property sector for funds. Their investment in this sector skyrocketed from HK$1.004 billion in 2005 to HK$8.065 billion last year, up 700 percent, while the number of transactions doubled from three to six. </FONT> <P align=justify><FONT color=#000000 size=3>Li said funds contributed 44 percent in value to total office investment last year, compared with a mere 6.7 percent in 2005. Unlike in 2005, in which transactions were predominantly Grade B, most office transactions last year were high-value entire-block Grade-A offices, showing that the office sector, in particular Grade-A offices, is gaining in popularity among funds because of its optimistic rental outlook. </FONT> <P align=justify><FONT color=#000000 size=3>Forecasting 2007 investment market performance, Li said foreign funds, aiming for high and realistic returns on their investments, will continue to look for offices, large and well-managed shopping malls and industrial properties in Hong Kong. </FONT> <P align=justify><FONT color=#000000 size=3>"Nevertheless, with availability of these properties dwindling and prices increasing significantly over the past two years due to heightened demand, the number of transactions may be lower this year as it becomes increasingly difficult for funds to secure prime properties in any of these sectors that meet their investment target," he said. </FONT> <P align=justify><FONT color=#000000 size=3>On the other hand, luxury residential, with its comparatively lower yields, will attract local and mainland investors, who tend to invest in this sector in a thriving economy, DTZ said. </FONT> <P align=justify><FONT color=#000000 size=3>Because supply in the high-end residential sector remains tight, with interest rates looking set to peak, and market sentiment boosted by recent encouraging land auction results and a positive economic outlook, the consultancy believes the luxury residential market will continue to find favor this year. </FONT> <P></SPAN></P>News from the Standard <!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=220 2007-01-07 <![CDATA[Developers set to lock horns on $8b MTR site]]> <font face='Arial, Helvetica, sans-serif'><P style="MARGIN: 0in 0in 12pt" class=MsoNormal align=justify><SPAN class=bodycopy><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Land hungry developers are likely to show keen enthusiasm in the MTR Corp's (0066) HK$8 billion Tseung Kwan O Area 56 development project after the company asked developers to register to tender. <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" /><o:p></o:p></FONT></FONT></FONT></SPAN></P> <P align=justify><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The railway company invited expressions of interest Friday from developers for the project atop its Tseung Kwan O station. <o:p></o:p></FONT></FONT></FONT></P> <P align=justify><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The site, with an area of 430,452 square feet, offers a gross floor area of between 1.11 million and 1.81 million sqft for residential, commercial and hotel use. The maximum number of residential units is 1,150 while the hotel is limited to 1,290 rooms. <o:p></o:p></FONT></FONT></FONT></P> <P align=justify><FONT size=3><FONT color=#000000><FONT face="Times New Roman">An MTR spokesman said there was no timetable for the tender yet. "If everything goes smoothly, we hope to start work within this year." <o:p></o:p></FONT></FONT></FONT></P> <P align=justify><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The land premium negotiations with the government are expected to be concluded soon. In railway tenders, developers submit their best offers, including the profit-sharing scheme, and bear all the costs of development, including land premium, construction and financing costs. <o:p></o:p></FONT></FONT></FONT></P> <P align=justify><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Henderson Land Development (0012) and Wheelock Properties (0049) said they would study the project. <o:p></o:p></FONT></FONT></FONT></P> <P align=justify><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Surveyors reckon the land premium could reach up to HK$54 billion, equivalent to an accommodation value of HK$2,976 per square foot if the upper GFA limit is used. <o:p></o:p></FONT></FONT></FONT></P> <P align=justify><FONT size=3><FONT color=#000000><FONT face="Times New Roman">"With such a large investment amount, it can only be the big developers," said chartered surveyor Pang Siu-kee of SK Pang Surveyors, adding it was premature to say if the MTR would pay half the premium as it did for the first <SPAN class=bodycopy>phase of </SPAN><?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" /><st1:place><st1:PlaceName><SPAN class=bodycopy>Dream</SPAN></st1:PlaceName><SPAN class=bodycopy> </SPAN><st1:PlaceType><SPAN class=bodycopy>City</SPAN></st1:PlaceType></st1:place><SPAN class=bodycopy> in Tseung Kwan O's Area 86 in early 2005 to attract smaller developers. In the end, that tender went to Cheung Kong (Holdings) (0001). <o:p></o:p></SPAN></FONT></FONT></FONT></P> <P align=justify><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Midland Surveyors director Alvin Lam Tze-pun said on completion, the flats could sell for HK$5,000 psf. <o:p></o:p></FONT></FONT></FONT></P> <P align=justify><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Developers have until next Friday to submit their expressions of interest. <o:p></o:p></FONT></FONT></FONT></P> <P align=justify><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Meanwhile, the government has sold Block A of Wylie Court, a former government quarters in Ho Man Tin, for HK$410.8 million through public tender to New World Development (0017). <o:p></o:p></FONT></FONT></FONT></P> <P align=justify><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Last month developers and investors submitted eight tenders for the 20-year- old property comprising 40 flats and car-park spaces. <o:p></o:p></FONT></FONT></FONT></P> <P align=justify><FONT size=3><FONT color=#000000><FONT face="Times New Roman"><st1:place>New World</st1:place> said last month that it is upbeat on the high-end residential market, and the firm would refurbish the Ho Man Tin residential tower if it won the bidding. Each flat in Block A, located at 15-23 Wylie Path, has a saleable area of about 1,629 sq ft. </FONT></FONT></FONT></P> <P align=justify><FONT size=+0><FONT color=#000000><FONT face="Times New Roman"><FONT size=2><EM>News from the Standard<o:p></o:p></EM></FONT></FONT></FONT></FONT></P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=219 2007-01-04 <![CDATA[BOCHK loses to HSBC in loan war]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy><FONT color=#000000 size=3>Hongkong and Shanghai Banking Corp overtook Bank of China (Hong Kong) (2388) as the biggest mortgage lender in 2006 after a home-loan price war amid shrinking mortgage and housing markets. </FONT> <P align=justify><FONT color=#000000 size=3>The Hong Kong-based unit of global banking giant HSBC Holdings (0005) fired the first salvo by cutting its mortgage rate to grab business last February. Since then, other rivals have followed suit to remain competitive. </FONT> <P align=justify><FONT color=#000000 size=3>In 2006, HSBC enjoyed a 17.6 percent slice of the mortgage market, followed by BOCHK with 15.9 percent, according to mReferral Mortgage Brokerage Services, which provides mortgage comparisons and referrals. Hang Seng Bank (0011) maintained third place last year with 13.8 percent. </FONT> <P align=justify><FONT color=#000000 size=3>BOCHK had topped the rankings with a 20.8 percent market share in 2005, with HSBC fourth on 9.8 percent. </FONT> <P align=justify><FONT color=#000000 size=3>Despite losing ground to HSBC in the first half of 2006, BOCHK reacted quickly by jumping into the home-loan price war and emerged as the biggest mortgage lender in the second half, said Centaline Property Agency research department associate director Wong Leung-sing. "But for the whole year, HSBC was still the biggest home-loan lender." </FONT> <P align=justify><FONT color=#000000 size=3>The two rivals cut their prime lending rate by 25 basis points to 7.75 percent in November. Their matching mortgage rates remain at about 5 percent, or 2.75 percent below prime. </FONT> <P align=justify><FONT color=#000000 size=3>Crimped by rising rates and weak buying sentiment in the first half last year, new loans drawn down dipped nearly 22 percent to about HK$100 billion in the first 11 months, from HK$128 billion in the same period the previous year - despite the fact that rates stabilized in the second half and may fall this year, mReferral said. </FONT> <P align=justify><FONT color=#000000 size=3>"The mortgage market slump last year intensified competition," said mReferral principal vice president Donald Cheng Wai-hung. </FONT> <P align=justify><FONT color=#000000 size=3>He expects figures for the whole of 2006 will be about HK$108 billion, down nearly 25 percent from HK$143 billion the year before. However, the mortgage market is likely to pick up in 2007 with new loans hitting their highest value since the 1997 peak, Cheng forecast, saying new residential loans may jump nearly 35 percent year on year to HK$145 billion this year. </FONT> <P align=justify><FONT color=#000000 size=3>He said prices for the secondary market in 2007 would rise by nearly 20 percent amid a downward trend in interest rates. </FONT> <P align=justify><FONT color=#000000 size=3>In 1997, new loans drawn down hit a record HK$256 billion, but tumbled to about HK$80 billion during the outbreak of SARS in 2003. </FONT> <P align=justify><FONT color=#000000 size=3>Last year, residential property transactions dropped more than 20 percent to 82,472 units, from 103,362 units in 2005, according to Land Registry figures. </FONT> <P align=justify><FONT color=#000000 size=3>In December, residential sales rose 2.1 percent to 7,255 units. Total consideration was HK$22.4 billion, up 14.9 percent over November. </FONT> <P>News from the Standard</SPAN></P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=218 2007-01-03 <![CDATA[Rates to determine property outlook]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>Hong Kong's residential property market enters the new year with a significant boost in the latter part of 2006 from expectations of falling interest rates, buoyant government land sales and a robust stock market. <BR>But analysts say interest rates will ultimately determine whether the housing market will see a sharp improvement this year.</FONT></P> <P align=justify><FONT color=#000000 size=3>Midland Realty chief analyst Buggle Lau Ka-fai said interest rates did not behave as expected last year. </FONT></P> <P align=justify><FONT color=#000000 size=3>"It not only did not peak in the first quarter, but dragged on to the third quarter before [the picture] became clearer." </FONT></P> <P align=justify><FONT color=#000000 size=3>The US Federal Reserve hiked interest rates four times in the first half of 2006 to 5.25 percent, but has since maintained that level. </FONT></P> <P align=justify><FONT color=#000000 size=3>This dragged down transactions for Hong Kong's primary and secondary markets from Lau's original estimate of more than 100,000 sales to about 80,000. </FONT></P> <P align=justify><FONT color=#000000 size=3>Secondary market transactions fell about 20.5 percent year on year to 70,209, with properties priced between HK$2 million and HK$5 million dropping 29 percent to about 17,772 transactions.</FONT></P> <P align=justify><FONT color=#000000 size=3>Primary market deals were particularly affected as developers held off sales of new projects. </FONT></P> <P align=justify><FONT color=#000000 size=3>Midland statistics show only 3,577 new home transactions in the first half of 2006 - "the lowest figure since records started," Lau said - compared to 9,332 for the same period in 2005.</FONT></P> <P align=justify><FONT color=#000000 size=3>Market sentiment improved in the second half as the US Fed kept interest rates steady. Local banks waged a mortgage war and developers thought it was the right time to launch new large projects for sale such as Park Island, Le Point and Grand Waterfront.</FONT></P> <P align=justify><FONT color=#000000 size=3>Midland statistics show there were 8,581 primary market sales in the second half, bringing the annual total to 12,158, but this was still 19 percent lower than in 2005 and the lowest since 1996.</FONT></P> <P align=justify><FONT color=#000000 size=3>Centaline Property Agency estimates Cheung Kong (Holdings) (0001) sold the most flats in the first 11 months of 2006 with 3,160 units, followed by Sun Hung Kai Properties (0016) with 2,288 units, and Henderson Land Development (0012) with 1,914. </FONT></P> <P align=justify><FONT color=#000000 size=3>Overall property prices in 2006 held up despite higher interest rates, with mass residential units seeing a 2.4 percent increase while super-luxury residential units saw a 19.7 percent hike, Lau said. </FONT></P> <P align=justify><FONT color=#000000 size=3>For this year, buyers can expect potential new supply of 116 projects comprising up to 31,907 units hitting the market, according to Ricacorp Properties research. </FONT></P> <P align=justify><FONT color=#000000 size=3>Eight of the 116 are large projects comprising more than 1,000 units each, totalling 16,102 flats.</FONT></P> <P align=justify><FONT color=#000000 size=3>These include the Central Park Towers (2,960 units), the long-delayed Hung Hom Peninsula (2,470 units), Yoho Town phase 2 (2,247 units), and Dream City phase 1 (2,096 units) in Tseung Kwan O.</FONT></P> <P align=justify><FONT color=#000000 size=3>But competing for buyers' attention will be the resumption of sales of surplus government built flats. </FONT></P> <P align=justify><FONT color=#000000 size=3>On Tuesday, the Hong Kong Housing Authority began inviting applications from eligible persons for 3,056 surplus Home Ownership Scheme flats at Wong Tai Sin, Sha Tin and Tin Shui Wai, with prices set at 30 percent off assessed market values. </FONT></P> <P align=justify><FONT color=#000000 size=3>Meanwhile, the Hong Kong Housing Society will sell 576 HOS units at Kingston Terrace in Tuen Mun.</FONT></P> <P align=justify><FONT color=#000000 size=3>Lau said the property market can expect a strong performance this year, pointing to indicators such as pay rises, falling unemployment and higher inflation. </FONT></P> <P>News from the Standard</P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=217 2007-01-01 <![CDATA[Quiet week for home sales]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>Primary market residential sales during the New Year's Eve weekend remained slow, following a quiet week as investors were in a festive mood, prompting developers to suspend promotions of new projects. <BR>Only about 30 flats were sold, compared to nearly 100 transactions during the four-day Christmas break.</FONT></P> <P align=justify><FONT color=#000000 size=3>Property Agency said sales were quiet because people were in party mode and not thinking about investment.</FONT></P> <P align=justify><FONT color=#000000 size=3>"Most investors are in a holiday mood now and not focusing on investing in properties," she said. "Sales activities only got a little velocity because the end users used the holidays to look around for homes."</FONT></P> <P align=justify><FONT color=#000000 size=3>HKR International (0480), which sold 25 units at its La Rossa development in Tung Chung during the Christmas holidays, moved only 10 units at an average price of HK$3,300 per square foot over the past two days. The company said Sunday that more than 10,000 visitors went to see its La Rossa showroom over the weekend.</FONT></P> <P align=justify><FONT color=#000000 size=3>Meanwhile, Henderson Land Development (0012) sold two houses at Beverly Hills in Tai Po.</FONT></P> <P align=justify><FONT color=#000000 size=3>Cheung Kong (Holdings) (0001) sold two flats at its Sausalito project Saturday, but did not sell any Sunday. Market sources believe Sun Hung Kai Properties (0016) sold 10 units at its Noble Hill project in Sheung Shui. "Sales activity might pick up a little [today] because it is the end of the three- day holiday, but I don't think it will show great improvement," Lau said. </FONT></P> <P align=justify><FONT color=#000000 size=3>"This year has been different from last year. People are in celebration mood, enjoying gatherings with family and friends and spending money on parties and buying products rather than making investments in property."</FONT></P> <P align=justify><FONT color=#000000>News from the Standard</FONT></P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=216 2006-12-29 <![CDATA[Flats for sale likely to dip anew]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>The number of new apartments put up for sale this year most likely fell for the fourth consecutive year as developers sat tight on project launches.<BR>In the first 11 months, 12,132 flats were released for sale, Real Estate Agency said.</FONT></P> <P align=justify><FONT color=#000000 size=3>He expects figures for the whole year to drop nearly 7 percent to 14,000 units from 15,000 units in 2005.</FONT></P> <P align=justify><FONT color=#000000 size=3>He said the number of new flats available for sale in the second half almost tripled to 10,357 from 3,643 in the first when buying sentiment was weak due to interest rate hikes.</FONT></P> <P align=justify><FONT color=#000000 size=3>He attributed the growth in sales in the second half to stable interest rates. The US Federal Reserve kept its federal funds rate unchanged at 5.25 percent in October. </FONT></P> <P align=justify><FONT color=#000000 size=3>It has been at that level since late June when the Fed raised rates for the 17th consecutive time in a two-year effort to curb inflation. </FONT></P> <P align=justify><FONT color=#000000 size=3>Agents expect steady interest rates to help improve market sentiment and encourage developers to roll out new projects.</FONT></P> <P align=justify><FONT color=#000000 size=3>Agents expects new flats available for sale to jump more than half year on year to 22,000 units in 2007.</FONT></P> <P align=justify><FONT color=#000000 size=3>Large-scale projects slated for sale next year include Hunghom Peninsula, YOHO Town Phase 2 in Yuen Long, Central Park Towers in Tin Shui Wai, Dream City Phase 1 in Tseung Kwan O.</FONT></P> <P align=justify><FONT color=#000000 size=3>Properties Agency said more than 18,000 new apartments will come on the market next year with total value of about HK$120 billion.</FONT></P> <P align=justify><FONT color=#000000 size=3>Most of the upcoming projects scheduled for sale are still being constructed, as government rules allow developers to sell a residential project 20 months ahead of its scheduled completion. </FONT></P> <P align=justify><FONT color=#000000 size=3>The revival of home sales in the second half of this year helped developers such as Cheung Kong (Holdings) (0001) and Sino Land (0083) reach their flat sales target.</FONT></P> <P align=justify><FONT color=#000000 size=3>Sino raked in more than HK$4 billion from the sale of more than 700 residential apartments in the first 11 months of the year.</FONT></P> <P align=justify><FONT color=#000000 size=3>Sino associate director for sales Mark Hahn Ka-fai said next year's sales schedule will depend on the progress of the government's presale consents of uncompleted flats for housing projects in Ho Tung Lau, Sha Tin and Wu Kai Sha. </FONT></P> <P align=justify><FONT color=#000000 size=3>Cheung Kong, which has topped the sales chart among major developers, reaped nearly HK$13 billion from the sale of nearly 3,500 flats in the first 11 months of this year. Hong Kong's second-largest developer by market capitalization has exceeded its original 2006 sales target of HK$10 billion to HK$12 billion, according to Justin Chiu Kwok-hung, executive director of Cheung Kong. </FONT></P> <P align=justify><FONT color=#000000 size=3>The developer is selling its Sausalito residential project in Ma On Shan.</FONT></P> <P align=justify><FONT color=#000000 size=3>Large-scale projects which received strong market responses in August included Sun Hung Kai Properties' (0016) Park Island Oceancrest phase five at Ma Wan, Cheung Kong's Le Point project at Tiu Keng Leng MTR station in Tseung Kwan O, and Henderson Land Development's (0012) Grand Waterfront in To Kwa Wan. </FONT></P> <P align=justify><FONT color=#000000 size=3>Residential property transactions rose 12 percent month on month to 7,106 units in November as an increase in secondary market transactions offset a decrease in new home sales. </FONT></P> <P align=justify><FONT color=#000000 size=3>The Land Registry figures showed total consideration was HK$19.5 billion last month, up 7.2 percent over October. </FONT></P> <P align=justify><FONT color=#000000 size=3>Agents said there were only 760 transactions in the primary market last month compared with 1,007 in October.</FONT></P> <P align=justify><FONT color=#000000 size=3>On the other hand, secondary transactions rose about 19 percent month on month to about 6,360 in November.</FONT></P> <P align=justify><FONT color=#000000 size=2>News from the Standard</FONT></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=215 2006-12-22 <![CDATA[Home loans to hit post-1997 high]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy><FONT color=#000000 size=3>The mortgage market is likely to be active next year with new loans hitting their highest value since the 1997 peak. </FONT> <P align=justify><FONT color=#000000 size=3>New residential loans may jump nearly 35 percent to HK$145 billion from about HK$108 billion this year, mReferral Mortgage Brokerage Services principal vice president Donald Cheng Wai-hung said. </FONT> <P align=justify><FONT color=#000000 size=3>"Given accumulated purchasing power, partly from upgraders, the number and value of transactions may increase next year," he said, adding that prices for the secondary market would rise by nearly 20 percent amid a downside trend in interest rates. </FONT> <P align=justify><FONT color=#000000 size=3>In 1997, new loans drawn down - approved mortgages being put to use - hit a record HK$256 billion. The value of new loans drawn down tumbled to nearly HK$80 billion during the trough in 2003. </FONT> <P align=justify><FONT color=#000000 size=3>Crimped by rising rates and weak buying sentiment in the first half of this year, new loans drawn down dipped 29 percent to HK$90.6 billion in the first 10 months, down from HK$128 billion. This was despite the fact that rates have stabilized and are expected to fall next year. </FONT> <P align=justify><FONT color=#000000 size=3>The agency expected figures for the whole of this year would be about HK$108 billion, down nearly 25 percent from HK$143 billion in 2005. </FONT> <P align=justify><FONT color=#000000 size=3>Residential transactions rose 12 percent to 7,106 last month when Bank of China (Hong Kong) (2388) emerged as the biggest mortgage lender for the third straight month. It had 23.4 percent of the market. </FONT> <P align=justify><FONT color=#000000 size=3>HSBC (0005) had an 11.8 percent slice of the market, followed by Hang Seng Bank (0011) with 11.1 percent. </FONT> <P align=justify><FONT color=#000000 size=3>The three banks cut their prime lending rate by 25 basis points to 7.75 percent last month in an ongoing price war. </FONT> <P align=justify><FONT color=#000000 size=3>With the market rising in the second half, prices are expected to rise again next year when sales may also increase, helping the mortgage market, DTZ Debenham Tie Leung said. The consultancy expected residential prices to rise a further 15 percent next year. </FONT> <P align=justify><FONT color=#000000 size=3>New World Development (0017) managing director Henry Cheng Kar- shun said there is still upside potential as demand is robust despite recent volatility. </FONT> <P align=justify><FONT color=#000000 size=3>Last month's 7,106 deals covered both the primary and secondary markets at a consideration of HK$19.5 billion, up 7.2 percent over October's figure. </FONT> <P align=justify><FONT color=#000000 size=3>Midland Realty chief analyst Buggle Lau Ka-fai said there were 760 primary market transactions, compared with 1,007 in October. But secondary transactions rose about 19 percent to about 6,360. </FONT> <P align=justify><FONT color=#000000 size=3>He expected this month's figures to show a further increase in sales of residential property, especially in the secondary market, due to falling lending rates. </FONT> <P align=justify><FONT color=#000000 size=3>Land Registry figures showed total deals in all sectors, including residential, commercial and industrial, topped 8,539, a 13 percent rise over October. Total consideration was HK$25.9 billion, up 19.3 percent. </FONT> <P align=justify><EM>News from the Standard</EM> <P></SPAN></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=214 2006-12-20 <![CDATA[SHKP sets new record in $1.8b bid]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodyCopy><FONT color=#000000 size=3>Sun Hung Kai Properties (0016) went all out at a land auction Tuesday, shelling out HK$1.8 billion for a prime luxury residential site on The Peak, and in the process beating market forecasts and smashing the previous record price per-square-foot set in 1997. </FONT> <P align=justify><FONT color=#000000 size=3>The accommodation value of the site at 12 Mount Kellett Road translates into HK$42,196 psf, based on the site's developable gross floor area of 42,658 sqft. </FONT> <P align=justify><FONT color=#000000 size=3>This is more than double the previous record of HK$18,357 psf set in January 1997 for a residential site in Nam Wan near Repulse Bay. </FONT> <P align=justify><FONT color=#000000 size=3>Property professionals had expected the Peak site to sell for about HK$1.2 billion, or more than HK$28,000 psf. </FONT> <P align=justify><FONT color=#000000 size=3>The final HK$1.8 billion price clocked in at 234 percent of the reserve price of HK$768 million. </FONT> <P align=justify><FONT color=#000000 size=3>SHKP, Hong Kong's largest developer by market capitalization, fended off fierce bidding from rivals like Sino Land (0083), New World Development (0017), and especially private developer Nan Fung to grab the prized site. </FONT> <P align=justify><FONT color=#000000 size=3>Sun Hung Kai Real Estate Agency executive director Victor Lui Ting said the group would invest HK$2.5 billion to develop about 10 houses on the site. </FONT> <P align=justify><FONT color=#000000 size=3>Asked why SHKP was so bold in paying such a high price for the land, Lui said the plot was rare, and from buyers' reactions to the company's luxury Severn 8 project, also at the Peak, there was a market catering to extremely wealthy buyers. </FONT> <P align=justify><FONT color=#000000 size=3>He said there was no bubble waiting to burst on the luxury market. </FONT> <P align=justify><FONT color=#000000 size=3>The final price for the Mount Kellett Road site was high, but not outside of expectations, said Lands Department assistant director Chris Mills. </FONT> <P align=justify><FONT color=#000000 size=3>He said the government had expected a "strong reaction" from the market and the final result indicated the market desired luxury sites. </FONT> <P align=justify><FONT color=#000000 size=3>Property professionals said the final price paid was way ahead of the most optimistic forecasts. </FONT> <P align=justify><FONT color=#000000 size=3>Vigers Appraisal &amp; Consulting executive director Tony Chan Tung-ngok said the final price was astonishing. "It may be the highest price per square foot in the world," Chan said. </FONT> <P align=justify><FONT color=#000000 size=3>"Beforehand nobody valued it at such a high price," said Midland Surveyors director Alvin Lam Tze-pun. </FONT> <P align=justify><FONT color=#000000 size=3>After spending more than HK$42,000 psf for the land, plus construction costs, Lam reckoned the developer would need to sell the finished homes at more than HK$50,000 psf in order to realize a profit. </FONT> <P align=justify><FONT color=#000000 size=3>"It [the land] is only the flour. Time is still needed to make the product. Nobody knows what the market will be two years from now," Lam said. </FONT> <P align=justify><FONT color=#000000 size=3>The strong auction result has caused rival developers to reassess their selling strategy. </FONT> <P align=justify><FONT color=#000000 size=3>Alex Lui Yiu-wah, managing director of K Wah Real Estates, said the company was considering hiking its prices. Meanwhile, Pacific Century Premium Developments (0432) executive director Wendy Gan Kim-see said her firm would stress price and not quantity for sales at phase five of its Bel-Air development near Cyberport in Pok Fu Lam. </FONT> <P align=justify><FONT color=#000000 size=3>Private developer Manhattan Garments (International), which triggered the Mount Kellett Road site for auction last month, said the price paid by SHKP was still reasonable and would set a new benchmark for the market. </FONT> <P><EM>News from the Standard</EM></SPAN></P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=213 2006-12-18 <![CDATA[RECORD HOPES AT PEAK]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>Developers are expected to fight tooth and nail at a land auction tomorrow for a rare residential site at The Peak, and in the process may set a new record price per square foot for land. </FONT></P> <P align=justify><FONT color=#000000 size=3>Many real estate professionals expect the final price for the 79,148 square foot site to be more than HK$1 billion, equivalent to an accommodation value of HK$23,400 per square foot. </FONT></P> <P align=justify><FONT color=#000000 size=3>The site at 12 Mount Kellett Road, which has an allowable total gross floor area of 42,658 square feet and could accommodate six to eight townhouses, already holds the highest reserve price on a per-square-foot basis among the sites triggered for auction since the government introduced its application list system, according to Ricacorp Properties executive director Willy Liu Wai-keung. </FONT></P> <P align=justify><FONT color=#000000 size=3>Last month private developer Manhattan Garments (International) controlled by Liberal Party chairman James Tien Pei-chun triggered the site for auction after the government agreed to its bid of HK$768 million or HK$18,000 psf. In the application list system, a developer must submit a price that is at least 80 percent of the government's reserve price for a site to be triggered for sale. </FONT></P> <P align=justify><FONT color=#000000 size=3>Midland Surveyors director Alvin Lam Tze-pun has estimated a final price per square foot of HK$24,000. </FONT></P> <P align=justify><FONT color=#000000 size=3>He said the lump sum of about HK$1 billion is not too expensive but what is attractive to developers was the rarity of the site. "The site is extremely good and I expect a lot of developers, big and small, to take part [in the auction]," Lam said. </FONT></P> <P align=justify><FONT color=#000000 size=3>Some small developers active at The Peak in building properties for leasing out may take part, he added. </FONT></P> <P align=justify><FONT color=#000000 size=3>"If many people bid, there is a chance it could be higher than what we estimated. There is a chance it could go over HK$30,000 psf," Lam said. </FONT></P> <P align=justify><FONT color=#000000 size=3>Henderson Land Development chairman Lee Shau-kee said last month the site would be a "strategic stronghold" to be fought over by developers. </FONT></P> <P align=justify><FONT color=#000000 size=3>"It would not be surprising if it went for double," he said. </FONT></P> <P align=justify><FONT color=#000000 size=3>Developers such as Cheung Kong (Holdings) (0001), New World Development (0017), Sun Hung Kai Properties (0016) and Sino Land (0083) have expressed interest in the site. </FONT></P> <P><FONT color=#000000 size=3><EM><FONT size=2>News from the Standard</FONT></EM></P></FONT></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=212 2006-12-14 <![CDATA[Latest Fed decision backs Yam theory]]> <font face='Arial, Helvetica, sans-serif'><P align=justify><FONT color=#000000 size=3>The US Federal Reserve's decision to keep interest rates unchanged squares with the "plateau" prophecy of Hong Kong Monetary Authority chief executive Joseph Yam Chi-kwong, who said Wednesday a stabilized interest rate will have a positive impact on borrowers and depositors.<BR>The city's four largest lenders, Hongkong and Shanghai Banking Corporation (0005), Bank of China (Hong Kong) (2388), Hang Seng Bank (0011) and Bank of East Asia (0023), have followed the Fed's move to retain interest rates at their current level.</FONT></P> <P align=justify><FONT color=#000000 size=3>HSBC, BOCHK and Hang Seng have kept their prime rates, or best lending rates, at 7.75 percent, while BEA's prime rate remains at 8 percent.</FONT></P> <P align=justify><FONT color=#000000 size=3>"Unless the Fed lowers its rate or the Hong Kong interbank offered rate [HIBOR] is further depressed, there will be little room for rate reduction," said Margaret Leung, HSBC's general manager and global co-head for commercial banking. HIBOR is the price lenders charge each other for loans.</FONT></P> <P align=justify><FONT color=#000000 size=3>Although several more initial public offerings have swept across the stock market, which in turn has "raised HIBOR," local banks remain aggressive in their mortgage lending, leaving little room for reducing interest rates, said Stanley Wong Yuen-fai, director of Industrial and Commercial Bank of China (Asia) (0349).</FONT></P> <P align=justify><FONT color=#000000 size=3>Yam reiterated his "plateau" theory, saying US interest rates will remain at a high level as the Fed remains uncertain how core inflation data and the slowing housing market in the country will impact consumer spending.</FONT></P> <P align=justify><FONT color=#000000 size=3>The Fed says "recent [economic] indicators have been mixed" and its view on inflation remains ambiguous.</FONT></P> <P align=justify><FONT color=#000000 size=3>"Inflation pressures seem likely to moderate over time, reflecting reduced impetus from energy prices, contained inflation expectations, and the cumulative effects of monetary policy actions," the Fed said in a statement.</FONT></P> <P align=justify><FONT color=#000000 size=3>"The extent and timing of any additional firming that may be needed to address" inflation risks lie in the "evolution of the outlook for both inflation and economic growth," the statement continued.</FONT></P> <P align=justify><FONT color=#000000 size=3>However, some analysts expect US interest rates to be cut during the course of next year. "The US economy is heading for a so-called soft landing and the slowdown in the housing market will be largely contained," said Mark Konyn, chief executive of Allianz Global Investors Hong Kong.</FONT></P> <P align=justify><FONT color=#000000 size=3>Konyn anticipated a "high degree of divergence in interest rate policy among the three large trading blocs" of Japan, Europe, and the United States.</FONT></P> <P align=justify><FONT color=#000000 size=3>"The long-anticipated interest rate hike in Japan is likely to be announced soon, and the European Central Bank has long signaled its intention to continue to raise rates," Konyn said.</FONT></P> <P align=justify><FONT size=3><FONT color=#000000>Shares of Hong Kong property stocks fell Wednesday with Cheung Kong (Holdings) (0001) and New World Development (0017) dropping by more than 2 percent.</FONT> </FONT></P> <P align=justify><EM><FONT color=#000000 size=2>News from the Standard</FONT></EM></P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=211 2006-12-12 <![CDATA[Interest heats up for Mid-Levels tender]]> <font face='Arial, Helvetica, sans-serif'><FONT size=4>Major developers are expected to show keen interest in next month's public tender for over 90 percent ownership of a residential building which sits on a prime Mid-Levels site that could be worth nearly HK$5 billion. </FONT> <P align=justify><SPAN style="FONT-FAMILY: Arial; COLOR: black; FONT-SIZE: 17pt; mso-ansi-language: EN-US; mso-fareast-language: ZH-TW; mso-bidi-language: AR-SA; mso-fareast-font-family: PMingLiU"><FONT size=4>Jones Lang LaSalle, the property consultant handling the tender, said Merry Terrace at Seymour Road which has good harbor views, has a site area of 52,466 square feet. This gives a redevelopment potential of a maximum gross floor area of 472,194 sqft, based on a plot ratio of nine. </FONT></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Arial; COLOR: black; FONT-SIZE: 17pt; mso-ansi-language: EN-US; mso-fareast-language: ZH-TW; mso-bidi-language: AR-SA; mso-fareast-font-family: PMingLiU"><FONT size=4>"Merry Terrace stands out as the only large private residential site available for sale in the traditional luxury area on the Island side," said Joseph Tsang Hon-ping, head of residential property at Jones Lang LaSalle. </FONT></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Arial; COLOR: black; FONT-SIZE: 17pt; mso-ansi-language: EN-US; mso-fareast-language: ZH-TW; mso-bidi-language: AR-SA; mso-fareast-font-family: PMingLiU"><FONT size=4>An indication of the selling price can be gleaned from the government auction last month for No1 Broadcast Drive, a luxury residential site in Kowloon Tong which was sold to Sino Land (0083) for HK$1.94 billion, or 76.4 percent above the reserve price. That translates into an accommodation value of HK$9,868 psf. Tsang declined to reveal the reserve price for Merry Terrace. </FONT></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Arial; COLOR: black; FONT-SIZE: 17pt; mso-ansi-language: EN-US; mso-fareast-language: ZH-TW; mso-bidi-language: AR-SA; mso-fareast-font-family: PMingLiU"><FONT size=4>If a round figure of HK$10,000 psf is used for accommodation value, then the site could be worth HK$4.72 billion. </FONT></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Arial; COLOR: black; FONT-SIZE: 17pt; mso-ansi-language: EN-US; mso-fareast-language: ZH-TW; mso-bidi-language: AR-SA; mso-fareast-font-family: PMingLiU"><FONT size=4>Tsang pointed out the site had a 999-year lease that was virtually unrestricted in terms of development. "The value [of the site] is here," Tsang said. </FONT></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Arial; COLOR: black; FONT-SIZE: 17pt; mso-ansi-language: EN-US; mso-fareast-language: ZH-TW; mso-bidi-language: AR-SA; mso-fareast-font-family: PMingLiU"><FONT size=4>The Mount Kellett Road site at The Peak which is due for public auction next Tuesday is far smaller in terms of allowable gross floor area at 42,658 sqft. Its reserve price is HK$768 million but the smaller GFA translates into a higher accommodation value of HK$18,000 psf. </FONT></SPAN></P> <P align=justify><SPAN style="FONT-FAMILY: Arial; COLOR: black; FONT-SIZE: 17pt; mso-ansi-language: EN-US; mso-fareast-language: ZH-TW; mso-bidi-language: AR-SA; mso-fareast-font-family: PMingLiU"><FONT size=4>Merry Terrace, completed in 1963, consists of five 14-story buildings with 196 residential units and 123 parking spaces. Tsang said more than 90 percent of owners have signed an agreement to sell the buildings, and he expects this figure to increase before the tender start date of January 2, 2007.</FONT><STRONG> </STRONG></SPAN></P> <P><SPAN style="FONT-FAMILY: Arial; COLOR: black; FONT-SIZE: 17pt; mso-ansi-language: EN-US; mso-fareast-language: ZH-TW; mso-bidi-language: AR-SA; mso-fareast-font-family: PMingLiU"><FONT size=2><EM>News from the Standard</EM></FONT></SPAN></P><!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=210 2006-12-05 <![CDATA[FLAT SALES RISE DESPITE LACK OF NEW OFFERS]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodycopy1><SPAN style="FONT-SIZE: 11pt"><FONT face=Verdana>Residential property transactions rose 12 percent month on month to 7,106 units last month as developers sat tight on new project launches, causing demand to flow to the secondary market. <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" /><o:p></o:p></FONT></SPAN></SPAN> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">The Land Registry released figures Monday showing total transactions in all property sectors topped 8,539, representing a 13 percent increase over October and a 6 rise percent year on year. </SPAN><o:p></o:p></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Total consideration was HK$25.9 billion, up 19.3 percent over October but down 8.8 percent when compared with November 2005. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">The 7,106 transactions in the residential sector covered both the primary and secondary markets at a consideration of HK$19.5 billion, up 7.2 percent on October¡¦s figure. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Property Agent analyst said there were only 760 transactions in the primary market compared with 1,007 in October when only a few new projects were launched. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">On the other hand, secondary transactions rose about 19 percent month on month to about 6,360. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Due to the delay in registering the transactions, each month¡¦s statistics generally reflect the situation of the month before. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Ricacorp Properties executive director agreed, saying: ¡§There wasn¡¦t much focus in the market in October.¡¨ He noted that after the big primary market sales in August and September for projects such as </SPAN><?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" /><st1:place><st1:PlaceType><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Park</SPAN></st1:PlaceType><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> </SPAN><st1:PlaceType><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Island</SPAN></st1:PlaceType></st1:place><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> and Le Point, developers held back on launches and concentrated on offloading inventory flats by selling at a discount to attract buyers in October. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">For example, New World Development (0017) cut prices at the 1,472-unit The Grandiose at Tseung Kwan O by 20 percent in early October, while private developer Nan Fung also cut prices by up to 20 percent at its </SPAN><st1:Street><st1:address><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Victoria Place</SPAN></st1:address></st1:Street><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> project in North Point. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Property Agent analyst expected this month¡¦s figures, which will reflect November¡¦s situation, to show a further increase in sales of residential property especially in the secondary market due to banks such as HSBC cutting its lending rates by 25 basis points to 7.75 percent early last month. <o:p></o:p></SPAN></P><I style="mso-bidi-font-style: normal"><SPAN style="FONT-FAMILY: 'Times New Roman'; FONT-SIZE: 10pt; mso-ansi-language: EN-US; mso-fareast-language: ZH-TW; mso-bidi-language: AR-SA; mso-fareast-font-family: PMingLiU"><FONT color=#000000>News from the Standard</FONT></SPAN></I> <!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=209 2006-12-04 <![CDATA[WORLD MAY BE HIT BY RECESSION IN 2008, WARNS EXPERT]]> <font face='Arial, Helvetica, sans-serif'><TABLE border=0 cellSpacing=0 cellPadding=0 width=740> <TBODY> <TR> <TD bgColor=#ffffff vAlign=top width="100%"> <TABLE border=0 cellSpacing=10 cellPadding=0 width="100%"> <TBODY> <TR> <TD> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; MARGIN: 0in 0in 0pt" class=MsoNormal><SPAN class=bodycopy><FONT size=3><FONT color=#000000><FONT face="Times New Roman">A global recession may be in the offing in 2008, Andy Xie Guozhong, the former chief economist of Morgan Stanley Dean Witter Asia, has warned. <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" /><o:p></o:p></FONT></FONT></FONT></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">"I believe the global economy could slow down to 4 percent in 2007 from 5.1 percent this year, despite being higher than historical standard. It may slide into recession by 2008," Xie said at an economic forum in <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" /><st1:City><st1:place>Beijing</st1:place></st1:City>, Friday. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Although the earnings momentum of mainland property developers is positive, Xie said the optimism in real estate will end when speculators exit the market as the Beijing 2008 Olympic Games draws near. He said he has noticed a supply-demand imbalance in the real estate sector. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">"As property investment is nearly 10 percent of the economy and the property market has supported profits of banking, raw materials, and many other sectors, its decline would have a large multiplier effect on the economy." <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Meanwhile, Xie said he is concerned that <st1:country-region><st1:place>US</st1:place></st1:country-region> inflation could rise significantly, leading to a global recession. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">He believes existing inflationary pressures are being underestimated by the financial markets. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">While there are expectations that the Federal Reserve will cut the benchmark short-term interest rate to boost the <st1:country-region><st1:place>US</st1:place></st1:country-region> economy, a rate cut could weaken the US dollar substantially, increasing inflationary pressure, he said. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Last week, Federal Reserve Bank of <st1:City><st1:place>Chicago</st1:place></st1:City> president Michael Moskow said higher interest rates may be needed to rein in inflation and that <st1:country-region><st1:place>US</st1:place></st1:country-region> economic growth should pick up toward 3 percent next year. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Also, last week the US dollar hit new lows against major currencies. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">A peak in commodities prices could also contribute to a global recession, Xie said. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Xie argued that rising commodity prices are a result of speculation. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">"I believe commodities have entered a bear market," Xie said, adding "the bottom would be in 2008." <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Oil prices surged in the spring to about US$80 (HK$624) per barrel, but have declined to about US$60 at present, about the same as end 2005. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-ALIGN: right; MARGIN: 0in 0in 0pt" class=MsoNormal align=right><I style="mso-bidi-font-style: normal"><SPAN style="FONT-SIZE: 10pt"><FONT color=#000000><FONT face="Times New Roman">News from the Standard<o:p></o:p></FONT></FONT></SPAN></I></P><!-------- End Content --------------------------></TD></TR></TBODY></TABLE></TD><!--- Right ----------------------------><!--- End Right ----------------------------> <TD bgColor=#3d3d3d width=1><IMG src="http://www.bestfortune.com.hk/images/top-10.gif" width=1 height=21></TD></TR></TBODY></TABLE></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=208 2006-12-01 <![CDATA[MARKET TO WELCOME SUBSIDIZED FLATS SALE]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodycopy><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The resumption of the Housing Society's subsidized flat sales early next year is expected to receive an enthusiastic reception from the market amid sustained demand, real estate agents said. <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" /><o:p></o:p></FONT></FONT></FONT></SPAN> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The society, a non-government statutory organization which aims to provide residents in the territory with housing and other relevant services, plans to resume the sale of the first phase of 576 flats at Kingston Terrace in Tuen Mun under its subsidized housing scheme. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The flats will be pitched at between HK$1,300 per square foot to HK$1,400 psf, or between HK$800,000 and HK$1.3 million each. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">"There is still robust demand for subsidized flats in the <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" /><st1:place><st1:PlaceName>New</st1:PlaceName> <st1:PlaceType>Territories</st1:PlaceType></st1:place> which are more affordable," Properties Agency said. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The price is nearly half of those in large-scale new projects in Tuen Mun. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The Sherwood residential project in Tuen Mun, developed by <st1:place><st1:PlaceName>Henderson</st1:PlaceName> <st1:PlaceType>Land</st1:PlaceType></st1:place>, was put on the market early this month at an average price of about HK$2,500 psf. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The project caters mainly to first-time buyers. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The price compared with the prevailing prices in the secondary market of about HK$2,000 psf. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Yeung Ka-sing, the newly appointed chairman of the Housing Society, a nonprofit-making body, said Kingston Terrace prices should be within the spending power of residents in the area, especially public housing tenants. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The flats, which were completed four years ago, have been on hold because of a government moratorium on subsidized home sales as part of efforts to stabilize tumbling home prices. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The moratorium is due to be lifted early next year. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Kingston Terrace, located in King San Path near the Tuen Mun light-rail network, has four blocks with a total of 1,152 flats. The remaining 576 apartments will be available for sale in 2008. The flats measure between 600 square feet and 800 sq ft each. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Property Agency said the release of Kingston Terrace flats will not exert pressure on the residential home market in Tuen Mun, as the subsidized flats cater mainly to buyers with limited money. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The agency said there is also a slight difference in quality. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Separately, the Housing Authority will in January start selling the first batch of 3,056 home- ownership-scheme flats at housing projects including Kingsford Terrace Stage I in Wong Tai Sin, Yu Chui Court Stage III in Sha Tin and <st1:Street><st1:address>Tin Fu Court</st1:address></st1:Street> in Tin Shui Wai at prices ranging from HK$1,010 psf to HK$2,420 psf. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Prices will be based on the market value of similar private residential developments in the vicinity and will include a 30 percent discount. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Property Agency also said the resumption of HOS flat sales may attract some first-time buyers from the private housing sector but the sales would have little impact on the mass residential market. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The government's 16,641 completed but vacant home ownership scheme units represent another potential supply source in the medium term. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Among the bigger estates due for sale are Kingsford Terrace with 2,010 flats; Yau Mei Court Phase 3 in Kowloon East with 1,480 flats; <st1:Street><st1:address>Kam Fung Court</st1:address></st1:Street> in Ma On San with 1,892 flats; <st1:Street><st1:address>Yu Chui Court</st1:address></st1:Street> in Sha Tin with 1,489 flats and <st1:Street><st1:address>Tung Tao Court</st1:address></st1:Street> in Hong Kong East with 1,216 flats. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The focus of market attention is Kingsford Terrace, real estate agents said. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">In 2004, the Housing Authority bought back the Wong Tai Sin subsidized flat project from developer New World Development for HK$1.44 billion. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">NWD managing director Henry Cheng Kar- shun said the price tags for the HOS projects are unlikely to affect prices at the former HOS project Hunghom Peninsula owned by NWD and Sun Hung Kai Properties with a total of 2,470 flats. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The Hung Hom project is expected to come on stream for sale this month or early next year. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-ALIGN: right; MARGIN: 0in 0in 0pt" class=MsoNormal align=right><I style="mso-bidi-font-style: normal"><SPAN style="FONT-SIZE: 10pt"><FONT color=#000000><FONT face="Times New Roman">News from the Standard<o:p></o:p></FONT></FONT></SPAN></I></P><!-------- End Content --------------------------><!--- Right ----------------------------><!--- End Right ----------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=207 2006-11-30 <![CDATA[Bright land auction prompts price rises]]> <font face='Arial, Helvetica, sans-serif'><P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; MARGIN: 0in 0in 12pt" class=MsoNormal><SPAN class=bodycopy1><SPAN style="FONT-SIZE: 11pt"><FONT color=#000000><FONT face=Verdana>Developers are hiking or reviewing their selling prices on the back of bullish sentiment in the property market following Tuesday's healthy land auction for two sites at Kowloon Tong and Ma On Shan. <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" /><o:p></o:p></FONT></FONT></SPAN></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Cheung Kong (Holdings) (0001) will add up to 8.8 percent at its </SPAN><?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" /><st1:City><st1:place><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Sausalito</SPAN></st1:place></st1:City><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> project in Ma On Shan, pushing prices up to as much as HK$8,000 per square foot for some waterfront-view units, when it restarts sales this weekend. </SPAN><o:p></o:p></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Cheung Kong deputy chief manager for sales William Kwok Tsz-wai said when construction costs of HK$1,500 psf and interest costs of HK$500 psf are added to the land costs of HK$3,600 psf for the Ma On Shan site, which Cheung Kong won Tuesday, the break-even cost for the development would be about HK$5,500 psf. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">However, ordinary units at </SPAN><st1:City><st1:place><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Sausalito</SPAN></st1:place></st1:City><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> where the original land cost was HK$2,700 psf were previously selling for about HK$5,000 psf. As such, Kwok said, it was entirely logical to increase prices. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><st1:place><st1:PlaceName><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Sino</SPAN></st1:PlaceName><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> </SPAN><st1:PlaceType><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Land</SPAN></st1:PlaceType></st1:place><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> (0083) which won the Kowloon Tong site is even more optimistic, with a company spokeswoman saying it had hiked prices of its inventory units at its luxury </SPAN><st1:place><st1:PlaceType><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Mount</SPAN></st1:PlaceType><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> </SPAN><st1:PlaceName><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Beacon</SPAN></st1:PlaceName></st1:place><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> project at Kowloon Tong by 15 percent. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Flats will now sell for HK$14,000 psf and higher while houses will sell for HK$20,000 psf. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><st1:place><st1:PlaceName><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Meanwhile</SPAN></st1:PlaceName><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> </SPAN><st1:PlaceName><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Henderson</SPAN></st1:PlaceName><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> </SPAN><st1:PlaceType><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Land</SPAN></st1:PlaceType></st1:place><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> Development (0012) started sales Tuesday of the first batch of units at its new Metro Regalia residential project at Tai Kok Tsui with average prices of about HK$4,000 psf. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">"I've only just released the price [for the first time] so there has not been a price increase," </SPAN><st1:City><st1:place><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Henderson</SPAN></st1:place></st1:City><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt"> general manager for sales Tony Tse Wai-chuen said. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">When asked if he would increase the price for future batches of flats at Metro Regalia and for its up-coming luxury project in Tai Po, The Beverly Hills, Tse said he would follow the latest market prices. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 11pt">Midland Realty chief analyst agreed Cheung Kong is facing a break-even price of about HK$5,500 when it starts sales several years from now.</SPAN></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=206 2006-11-29 <![CDATA[SALE REAPS $5.18B IN MIXED RESULTS]]> <font face='Arial, Helvetica, sans-serif'><P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; MARGIN: 0in 0in 12pt; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none" class=MsoNormal><FONT size=3><FONT color=#000000><FONT face="Times New Roman"><?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" /><st1:place><SPAN class=bodycopy>Hong Kong</SPAN></st1:place><SPAN class=bodycopy>'s biggest land sale this fiscal year produced mixed results Tuesday when two residential plots went to Cheung Kong (Holdings) (0001) and </SPAN><st1:place><st1:PlaceName><SPAN class=bodycopy>Sino</SPAN></st1:PlaceName><SPAN class=bodycopy> </SPAN><st1:PlaceType><SPAN class=bodycopy>Land</SPAN></st1:PlaceType></st1:place><SPAN class=bodycopy> (0083) for a combined HK$5.18 billion. <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" /><o:p></o:p></SPAN></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Sino won a coveted luxury site in Kowloon Tong for a surprisingly high bid of HK$1.94 billion at Tuesday's auction. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Cheung Kong, <st1:place>Hong Kong</st1:place>'s second-largest developer by market value, secured the other plot in Ma On Shan suited for mass residential housing for HK$3.24 billion, which was at the low end of analyst expectations. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Analysts said the mixed results reflect the divergence in the housing market between the high end and the mass market. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The auction boosted the government's total land income to about HK$32 billion, already surpassing its target of HK$30.5 billion for the financial year ending <st1:date Day="31" Month="3" Year="2007">March 31, 2007</st1:date>. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">In the first eight months, land income from lease modifications and private treaty grants has reached nearly HK$27 billion. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman"><st1:place><st1:PlaceName>Sino</st1:PlaceName> <st1:PlaceType>Land</st1:PlaceType></st1:place> fended off 10 rivals including Nan Fung Development, KWah International (0173), Chinachem Group, Kerry Properties (0683) and Henderson Land Development (0012) to win the Kowloon Tong site for HK$9,868 per square foot. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">This was up 76.4 percent from the reserve price of HK$1.1 billion or HK$5,595 psf. <o:p></o:p></FONT></FONT></FONT></P> <P style="LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The winning bid beat analyst forecasts of between HK$1.3 billion and HK$1.8 billion. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The unusually high price is expected to set a benchmark for next month's auction of a luxury residential site on The Peak, which analysts <SPAN class=bodycopy>expect will also draw fierce bidding in the face of a dearth of luxury residential sites in </SPAN><st1:place><SPAN class=bodycopy>Hong Kong</SPAN></st1:place><SPAN class=bodycopy>'s poshest residential district. <o:p></o:p></SPAN></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Sino chairman Robert Ng Chee- siong said the company will invest nearly HK$3 billion or HK$15,000 psf in the Kowloon Tong project, a combination of land costs and construction costs. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The site, at the former government quarters at <st1:Street><st1:address>1 Broadcast Drive</st1:address></st1:Street>, will match the design of Sino's nearby luxury <st1:place><st1:PlaceType>Mount</st1:PlaceType> <st1:PlaceName>Beacon</st1:PlaceName></st1:place> development, Ng said. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">He expected future selling prices for the new development to exceed the price tag of HK$14,500 psf for <st1:place><st1:PlaceType>Mount</st1:PlaceType> <st1:PlaceName>Beacon</st1:PlaceName></st1:place> by more than 30 percent. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Cheung Kong, meanwhile, outbid six developers from K Wah, Chinachem, New World Development (0017) and other unidentified developers to secure the Ma On Shan site for HK$3,662 psf, up 35 percent from the opening bid of HK$2.4 billion or HK$2,712 psf. <o:p></o:p></FONT></FONT></FONT></P> <P style="LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Analysts expect the site to fetch between HK$3.2 billion and HK$4 billion. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Cheung Kong deputy chairman Victor Li Tzar-kuoi estimates total investment in the Ma On Shan project at nearly HK$6,000 psf. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The developer won the site of the <st1:City><st1:place>Sausalito</st1:place></st1:City> project in Ma On Shan two years ago for HK$2.09 billion or HK$2,773 psf. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">"We would need to discuss future pricing with colleagues for the nearby <st1:City><st1:place>Sausalito</st1:place></st1:City> project which had stopped sales prior to the land auction," Li said. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Midland Surveyors director said Tuesday's auction of the Ma On Shan site drew less interest because the reserve price was higher which deterred some smaller developers. There is also a bigger supply of similar quality flats in the area. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Investors did not share the evident confidence of developers as to the direction of steady property prices, as the Hang Seng Property Index, which tracks <st1:place>Hong Kong</st1:place>'s five largest developers, fell 4.8 percent Tuesday while the benchmark Hang Seng Index dipped 2.9 percent. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Cheung Kong shares plunged 5.08 percent Tuesday to close at HK$90.55 after the auction, while shares of <st1:place><st1:PlaceName>Sino</st1:PlaceName> <st1:PlaceType>Land</st1:PlaceType></st1:place> dropped nearly 4 percent to HK$14.16. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Tuesday's auction was the government's third in the current fiscal year, but was by far the biggest. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">In the previous two auctions in July and September this year, two minor residential sites in Tsuen Wan and <st1:place><st1:PlaceName>Lantau</st1:PlaceName> <st1:PlaceType>Island</st1:PlaceType></st1:place> fetched HK$83.5 million. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><FONT color=#000000 size=3 face="Times New Roman">The government has amassed HK$5.264 billion from land auctions so far this financial year. </FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><I style="mso-bidi-font-style: normal"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">News from the Standard<o:p></o:p></FONT></FONT></FONT></I></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=205 2006-11-28 <![CDATA[IP HOLDS COURSE ON CRUISE TERMINAL]]> <font face='Arial, Helvetica, sans-serif'><TABLE border=0 cellSpacing=0 cellPadding=0 width=740> <TBODY> <TR> <TD bgColor=#ffffff vAlign=top width="100%"> <TABLE border=0 cellSpacing=10 cellPadding=0 width="100%"> <TBODY> <TR> <TD> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; MARGIN: 0in 0in 0pt" class=MsoNormal><SPAN class=bodycopy><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The administration has stood firm on plans to grant 50-year operating rights on the new cruise terminal at Kai Tak, saying it is necessary to ensure profitable returns for the winning bidder. <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" /><o:p></o:p></FONT></FONT></FONT></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Government officials also rebuffed suggestions from legislators that putting such a prime piece of waterfront real estate in the hands of the private sector for so many years could have an adverse impact on <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" /><st1:place>Hong Kong</st1:place>, especially if an economic downturn forced the operator to neglect the 7.6-hectare site. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Secretary for Economic Development and Labour Stephen Ip Shu-kwan argued the price tag on the investment - expected to be around HK$2.4 billion - would ensure the winning bidder had a stake in the project's success. "The winning bidder will do its best because, if it doesn't, it will be its own loss," he said. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The administration revealed the terms of its plan for the site late last month, saying it would call for tenders late next year before naming a winner in early 2008. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The successful bidder will then be expected to complete construction on at least one of the two 400-meter-long cruise berths by 2012, with the government estimating returns of between HK$1.2 billion and HK$2.4 billion a year to 2020. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">But the plan drew fire from lawmakers who questioned the wisdom of such a long lease. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Ronny Tong Ka-wah, a Civic Party legislator, said he wondered about the legality of granting land rights to a private company until 2047, when the "one country, two systems" administration is scheduled to end. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">But Permanent Secretary for Economic Development Eva Cheng Yu-wah said there was nothing illegal about the move. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Democratic Party chairman Lee Wing-tat asked if the government had considered limiting operating rights to 20 years or 25 years. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Legislator Fred Li Wah-ming pointed out that most public facilities developed under a build-operate-transfer system lasted no more than 30 years. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Cheng, however, stressed the cruise plan was not a build-operate-transfer project. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">She rejected suggestions the land grant be reviewed midway, arguing the 50-year operating right had to be clearly stated to encourage bidders to come forward. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Last month, Cheng said that, since the government would not be investing in the Kai Tak terminal, officials had no plan to monitor or restrict the operator. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Cheng and Ip added Monday the government was putting the proposed cruise terminal on the fast track, promising to compress all the work into as short a timeframe as possible to make sure the terminal was operational within six years. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Six years, though, was already too long for some lawmakers. The Democratic Party's Sin Chung-kai called for a further compression of the timetable, while Howard Young How-wah, who represents the tourism industry in the Legislative Council, pointed out that rival <st1:country-region><st1:place>Singapore</st1:place></st1:country-region> would have had a 20-year headstart by the time the cruise boats first arrive at Kai Tak in 2012. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">But Ip said everything that could be cut or compressed had already been done. He added the government would work hard to address the notoriously foul odors from neighboring <st1:place><st1:PlaceName>Kowloon</st1:PlaceName> <st1:PlaceType>City</st1:PlaceType></st1:place> and Kwun Tong. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The discussions came as the Designing Hong Kong Harbour District, a local environmental group, issued a paper calling the plans at Kai Tak "a planning failure of historic proportions." <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The group, headed by Paul Zimmerman, criticized government proposals for new roads to link the cruise terminal with the rest of <st1:City><st1:place>Kowloon</st1:place></st1:City> - plans the organization said would spell the end of Kai Tak. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-ALIGN: right; MARGIN: 0in 0in 0pt" class=MsoNormal align=right><I style="mso-bidi-font-style: normal"><SPAN style="FONT-SIZE: 10pt"><FONT color=#000000><FONT face="Times New Roman">News from the Standard<o:p></o:p></FONT></FONT></SPAN></I></P><!-------- End Content --------------------------></TD></TR></TBODY></TABLE></TD><!--- Right ----------------------------><!--- End Right ----------------------------> <TD bgColor=#3d3d3d width=1><IMG src="http://www.bestfortune.com.hk/images/top-10.gif" width=1 height=21></TD></TR></TBODY></TABLE></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=204 2006-11-27 <![CDATA[AUCTION FOR PRIME LOTS SET TO RAISE $6B]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodycopy><FONT size=3><FONT face="Times New Roman"><FONT color=#000000>Two plum residential land sites are expected to add as much as HK$6 billion to government coffers when they go under the hammer tomorrow. <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" /><o:p></o:p></FONT></FONT></FONT></SPAN> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT face="Times New Roman"><FONT color=#000000>Fierce bidding is likely to drive total final prices for the sites in Kowloon Tong and Ma On Shan to between HK$4.5 billion and HK$6 billion, according to surveyors and developers, who expect the sale to provide a positive impetus to the residential property market. The auction will also boost government hopes of meeting its HK$30.5 billion target to be raised through land sales, including auctions, lease modifications and private treaty grants, in the fiscal year ending March 2007. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT face="Times New Roman"><FONT color=#000000>In the first eight months, total land income from lease modifications and private treaty grants has reached nearly HK$27 billion. The two sites were successfully triggered for sale by mid-tier developer K Wah International (0173). <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT face="Times New Roman"><FONT color=#000000>Key developers including Cheung Kong (Holdings) (0001), Sun Hung Kai Properties (0016), Henderson Land Development (0012) and <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" /><st1:place><st1:PlaceName>Sino</st1:PlaceName> <st1:PlaceType>Land</st1:PlaceType></st1:place> (0083) said they will take part in the auction. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT face="Times New Roman"><FONT color=#000000>Cheung Kong won the residential site of the <st1:City><st1:place>Sausalito</st1:place></st1:City> project in Ma On Shan two years ago for HK$2.09 billion, or HK$2,773 per square foot. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT face="Times New Roman"><FONT color=#000000>The HK$2.4 billion reserve price for the 176,960 sq ft lot at No548 in Area 77 in Ma On Shan, scheduled to be auctioned Tuesday, works out to about HK$2,712 psf. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT face="Times New Roman"><FONT color=#000000>A residential project to be built on the site will provide 1,080 apartments with a gross floor area of 884,801 sq ft. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT face="Times New Roman"><FONT color=#000000>Midland Surveyors expected the site could fetch HK$3.6 billion, or HK$4,069 psf, representing 50 percent above the opening bid. He said the selling price for the Ma On Shan project will likely exceed HK$6,000 psf. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT face="Times New Roman"><FONT color=#000000>K Wah Real Estate forecast spirited bidding to boost the final price for the site to between HK$4 billion and HK$5 billion. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT face="Times New Roman"><FONT color=#000000>K Wah set off the release of the Kowloon Tong luxury residential site with a minimum guaranteed bid of HK$1.1 billion, or HK$5,595 psf. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT face="Times New Roman"><FONT color=#000000>Surveyors said the site could be sold for between HK$1.3 billion and HK$1.8 billion. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT face="Times New Roman"><FONT color=#000000>Ricacorp Properties sounded more bullish, forecasting the final price to be at least HK$1.8 billion, up 64 percent from the reserve price. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT face="Times New Roman"><FONT color=#000000>The 65,531 sq ft site could yield a gross floor area of 196,593 sq ft. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT face="Times New Roman"><FONT color=#000000>In the previous two government land auctions - in July and September - strong bidding for two minor residential plots drove up the final price by 77 percent and 111 percent, respectively. The plots, in Tsuen Wan and <st1:place><st1:PlaceName>Lantau</st1:PlaceName> <st1:PlaceType>Island</st1:PlaceType></st1:place>, fetched HK$83.5 million. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT color=#000000 size=3 face="Times New Roman">Under the government's application list system, a developer has to submit a price for a site that is at least 80 percent of the government's own estimate to successfully trigger an auction. </FONT></P><I style="mso-bidi-font-style: normal"><SPAN style="FONT-FAMILY: 'Times New Roman'; FONT-SIZE: 10pt; mso-ansi-language: EN-US; mso-fareast-language: ZH-TW; mso-bidi-language: AR-SA; mso-fareast-font-family: PMingLiU"><FONT color=#000000>News from the Standard</FONT></SPAN></I> <!-------- End Content --------------------------></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=203 2006-11-24 <![CDATA[SALES OF HOS FLATS WILL NOT HURT MARKET: ESTATE AGENTS]]> <font face='Arial, Helvetica, sans-serif'><SPAN class=bodycopy1><SPAN style="FONT-SIZE: 13pt"><FONT face=Verdana>The relaunch of the government's home ownership scheme flats early next year may capture some first-time buyers from the private housing sector, but its impact on the overall residential market will be minimal, market figures said. <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" /><o:p></o:p></FONT></SPAN></SPAN> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">Given the limited number of the first batch of 3,056 HOS flats which will become available, the sales will have only a short-term effect on the market, Property Agency research said. </SPAN><o:p></o:p></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">"Some prospective first-time buyers from the private residential market will switch their focus to HOS flats, which are attractively priced," Property Agency research said. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">Cheung Kong (Holdings) deputy chief manager for sales William Kwok Tsz-wai said there was still a price gap between the government's subsidized flats and the private housing sector. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">"Some second-hand flats in small- scale private housing developments with poor facilities may be affected by the relaunch of HOS flats," Kwok said. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">HKR International marketing manager Violet Lam Hung said the relaunch of HOS flats would have little influence on the private residential market, as HOS units cater mainly to buyers with less money. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">She added there was also a quality difference between the two markets. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">Midland Realty chief analyst said demand from first- time buyers for small flats remains robust, as reflected in Land Registry figures. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">These showed 29,878 transactions worth less than HK$1.5 million each were recorded in the first 10 months of this year, accounting for 51.4 percent of overall transaction volume in the secondary market for the period. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">But the relaunch of HOS flats would still only have a minor impact on the secondary private residential market. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">In January, the authority will start selling flats at Kingsford Terrace Stage I in Wong Tai Sin, Yu Chui Court Stage III in Sha Tin and </SPAN><?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" /><st1:Street><st1:address><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">Tin Fu Court</SPAN></st1:address></st1:Street><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt"> in Tin Shui Wai. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">Prices will be based on the market value of similar private residential developments in the vicinity and will include a 30 percent discount. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">The prices will also take into account the fact that the flats have been vacant for several years since they were completed. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">The authority said mortgage payments should not exceed 40 percent of the income of the buyers. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">Selling prices for the flats are expected to range from HK$563,000 to HK$1,896,700, which translates into HK$1,010 and HK$2,420 per square foot, respectively. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">The government's 16,641 completed but vacant home ownership scheme units represent another potential supply source in the medium term. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">In January this year, the Housing Authority said it would resume sales of these flats in two phases per year, with 2,000 to 3,000 flats per phase, starting from 2007. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">The government suspended the sale of all subsidized flats, including HOS flats, in 2002 to stabilize slumping home prices. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">Only public rental housing tenants (green-form applicants) and eligible households (white-form applicants) are permitted to buy the flats. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">White-form applicants are subject to limits on their income and assets when applying for the flats. Monthly income is limited to HK$22,000, while assets are limited to HK$610,000. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">The quota allocation between white- form and green-form applicants will be set at 20:80. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">Among the bigger estates due for sale are Kingsford Terrace with 2,010 flats; Yau Mei Court Phase 3 in Kowloon East with 1,480 flats; </SPAN><st1:Street><st1:address><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">Kam Fung Court</SPAN></st1:address></st1:Street><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt"> in Ma On San with 1,892 flats; </SPAN><st1:Street><st1:address><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">Yu Chui Court</SPAN></st1:address></st1:Street><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt"> in Sha Tin with 1,489 flats; and </SPAN><st1:Street><st1:address><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">Tung Tao Court</SPAN></st1:address></st1:Street><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt"> in Hong Kong East with 1,216 flats. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">Ricacorp Properties executive director Willy Liu Wai-keung said that, in the long run, the resumption of HOS flat sales would build up buying momentum from first-time buyers which would, in turn, benefit the overall market in future. <o:p></o:p></SPAN></P> <P align=right><EM>News from the Standard</EM></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=202 2006-11-23 <![CDATA[ANALYSTS RAISE GDP FULL-YEAR FORECAST]]> <font face='Arial, Helvetica, sans-serif'><TABLE border=0 cellSpacing=0 cellPadding=0 width=740> <TBODY> <TR> <TD bgColor=#ffffff vAlign=top width="100%"> <TABLE border=0 cellSpacing=10 cellPadding=0 width="100%"> <TBODY> <TR> <TD> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; MARGIN: 0in 0in 12pt" class=MsoNormal><SPAN class=bodycopy><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Following Tuesday's announcement of better-than-expected third-quarter economic results, analysts have raised their growth forecast for the full year. <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" /><o:p></o:p></FONT></FONT></FONT></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Most are optimistic about the city's economic prospects in the near term, but expect a slowdown next year, dragged by a slowing <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" /><st1:country-region><st1:place>United States</st1:place></st1:country-region> economy. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">"The-stronger-than-expected real GDP growth for 3Q this year should boost market confidence in <st1:place>Hong Kong</st1:place>'s future growth prospects," Citigroup said Wednesday. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">It raised its 2006 growth forecast to 6.7 percent, up from 6 percent. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Government figures showed <st1:place>Hong Kong</st1:place>'s gross domestic product grew 6.8 percent in the third quarter, as business investment expenditures surged while exports and domestic consumption remained robust. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">The city is brimming with consumer confidence, driven by an improving job market and soaring stock prices. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Economists maintain a positive outlook for the fourth quarter, but view a slowing <st1:country-region><st1:place>US</st1:place></st1:country-region> economy as a threat. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">"On the external side, in addition to the slowdown in the US economy, some moderate slowdown in mainland exports is expected, due to government policies, to reduce export growth that will hurt Hong Kong's exports," said Paul Tang, chief economist at Bank of East Asia. He predicted full-year 2006 GDP growth of 6.5 percent, followed by a slowdown next year. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">But some economists say the <st1:country-region><st1:place>US</st1:place></st1:country-region> downturn will not adversely affect <st1:place>Hong Kong</st1:place>'s exports, as the slump is concentrated in the housing industry. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">" But in the second half of 2007, both US and Chinese economies are expected to moderate, which will hurt Hong Kong's growth momentum," said JPMorgan economist Qian Wang who forecasts 5 percent GDP growth for next year. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">Ten economists surveyed by Reuters expect the SAR's economy to rise 6.6 percent this year, followed by 5percent in 2007. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">"We are optimistic on <st1:place>Hong Kong</st1:place>'s economic prospects over the medium term, believing that the economy is well-positioned to leverage on opportunities from <st1:country-region><st1:place>China</st1:place></st1:country-region>'s multi- decade development," said Morgan Stanley. <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify"><FONT size=3><FONT color=#000000><FONT face="Times New Roman">"But with gigantic asset markets relative to the size of the economy, <st1:place>Hong Kong</st1:place> has to get accustomed to more volatile business cycles." <o:p></o:p></FONT></FONT></FONT></P> <P style="TEXT-ALIGN: right; MARGIN: 0in 0in 0pt" class=MsoNormal align=right><I style="mso-bidi-font-style: normal"><SPAN style="FONT-SIZE: 10pt"><FONT color=#000000><FONT face="Times New Roman">News from the Standard<o:p></o:p></FONT></FONT></SPAN></I></P><!-------- End Content --------------------------></TD></TR></TBODY></TABLE></TD><!--- Right ----------------------------><!--- End Right ----------------------------> <TD bgColor=#3d3d3d width=1><IMG src="http://www.bestfortune.com.hk/images/top-10.gif" width=1 height=21></TD></TR></TBODY></TABLE></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=201 2006-11-20 <![CDATA[$7.5b loss in vacant factories]]> <font face='Arial, Helvetica, sans-serif'><FONT face=Verdana><SPAN class=bodycopy1><SPAN style="FONT-SIZE: 13pt">More than 11 million square feet of factory space in </SPAN></SPAN><?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" /><st1:place><SPAN class=bodycopy1><SPAN style="FONT-SIZE: 13pt">Hong Kong</SPAN></SPAN></st1:place><SPAN class=bodycopy1><SPAN style="FONT-SIZE: 13pt"> has been left vacant over the past five years, wasting HK$7.5 billion in government resources, a study by </SPAN></SPAN><st1:place><st1:PlaceName><SPAN class=bodycopy1><SPAN style="FONT-SIZE: 13pt">Polytechnic</SPAN></SPAN></st1:PlaceName><SPAN class=bodycopy1><SPAN style="FONT-SIZE: 13pt"> </SPAN></SPAN><st1:PlaceType><SPAN class=bodycopy1><SPAN style="FONT-SIZE: 13pt">University</SPAN></SPAN></st1:PlaceType></st1:place><SPAN class=bodycopy1><SPAN style="FONT-SIZE: 13pt"> has found. <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" /><o:p></o:p></SPAN></SPAN></FONT> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">The study, commissioned by 25 trade associations, found that 7.3 percent of factory space in Chai Wan, Tuen Mun and Kwai Tsing, for example, remained empty last year. </SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">But, according to lawmaker Wong Ting-kwong of the Democratic Alliance for the Betterment and Progress of Hong Kong, there is even more vacant factory space out there as more industries relocate to the mainland, coupled with the complications and costs that are involved in land-use conversions. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">Wong, who represents the import- export functional constituency, and four trade association representatives expressed concern over the situation Monday and put forward eight proposals on how to put empty industrial space to better use. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">"</SPAN><st1:place><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">Hong Kong</SPAN></st1:place><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt"> industries have experienced structural transformation in the past 20 years. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">"Better use of our vacant factory spaces will be beneficial for the economy," Wong said. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">He said since industrial activities in Hong Kong have shifted from being manufacturing and production oriented to a more diverse management, service- oriented and information base, the existing definitions of "factory" and "industrial use" are outdated and should be relaxed to accommodate new types of industries such as design, IT, research and development. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">Another recommendation is to simplify administrative procedures in converting land use through better communication with the Housing, Planning and Lands Bureau. In place of complicated procedures and paying expensive land premiums, requiring companies to pay only 3 percent of the land rent for changes in use of sites will encourage industrial conversions, Wong said. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">The group also called for broadening land use to cover the retail sector by transforming vacant factory units for use by industries such as jewelry designing and original design manufacturing. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">Land-use restrictions can also be eased to allow vacant buildings to be transformed into two- or three-star hostels to accommodate more tourists. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">The suggestions also include rezoning sites of old vacant factory buildings. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">Similar plans were put to Secretary for Housing, Planning and Lands Michael Suen Ming-yeung in the Legislative Council earlier this month. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">According to Suen, the existing 10 factory estates under the Housing Authority have a 97 percent utilization rate, while that for the more than 17.468 million square metres of private flatted factories was 90 percent. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">The Lands Department has reported no misuse of government factory units, but said 57 units of private flatted factories had been misused in the past two years. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">The Town Planning Board has introduced various measures in the past decade to expand the definition of industrial use. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">The use of industrial land is also more flexible than the past. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">The land use now includes offices related to industrial use, IT and telecommunications industries and research, design and development centers related to industry and non-polluting industries. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">Since 2001, 246 hectares of sites originally zoned for industrial use have been rezoned for other uses, including business, residential, comprehensive development area and commercial. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">Suen said the Lands Department has allowed users of premises designated for industrial use to change over into other suitable uses through application for short-term waivers. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">The department will continue to monitor the supply and demand for industrial land as well as the situation in the use of industrial buildings. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">On whether to relax user restrictions on factory building units to facilitate their conversion into other uses, Suen said that does not fall within the coverage of the Factories and Industrial Undertakings Ordinance. <o:p></o:p></SPAN></P> <P style="TEXT-JUSTIFY: inter-ideograph; TEXT-ALIGN: justify; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 13pt">The study, conducted by the university's building and real estate researchers, was commissioned by groups such as the Small and Medium Enterprise Association and and the Kowloon Chamber of Commerce. <o:p></o:p></SPAN></P> <P style="TEXT-ALIGN: right; LAYOUT-GRID-MODE: char; mso-layout-grid-align: none" align=right><I style="mso-bidi-font-style: normal"><SPAN style="FONT-FAMILY: Verdana; COLOR: black; FONT-SIZE: 10pt">News from the Standard<o:p></o:p></SPAN></I></P></font> http://www.bestfortune.com.hk/eng/news_detail2.php?sno=200