Wharf Holdings has brought along some friends for its second trip to Hong Kong’s posh Peak district in the last two months, as the local developer joined with a group of investors to win a tender for a luxury residential site.
Hong Kong’s Lands Department announced today that Active Pursuit Limited, a company controlled by Wharf, together with a collection of some of Hong Kong’s wealthiest people, had won the tender for the site on Mansfield Road with a HK$7.25 billion ($935 million) bid.
The successful acquisition was announced just 48 days after the developer controlled by billionaire Peter Woo had won the rights to an adjoining site, with the two plots together allowing for development of up to nearly 404,000 square feet (37,530 square metres) of housing.
The bid announced today has the winning consortium agreeing to pay the equivalent of HK$50,011 per square foot of accommodation, or over 7 percent more than the price Wharf paid in the December tender, as Hong Kong’s housing market continues to show signs of a revival.
Rivals Join Wharf’s Team
Joining Wharf in this latest purchase are Boswell Holdings, a private company controlled by Sino Land chairman Robert Ng, along with CC Land chairman Cheung Chung Kiu, Lifestyle Holdings chairman Thomas Lau and Chinese Estates executive director Chan Hoi Wan. Lau and Chan are the brother and wife, respectively of Chinese Estates chairman Joseph Lau, who remains a fugitive from a bribery conviction in Macau.
The winning team has secured the rights to develop up to 144,968 square feet of gross floor area on the 54,541 square foot site under a 50-year leasehold. Wharf’s adjacent plot measures 135,000 square feet and is approved for development of up to 259,000 square feet of housing.
To win the tender, which closed last Friday, Wharf and friends had outbid rival offers from Li Ka-shing’s CK Asset Holdings, Henderson Land Development, Sun Hung Kai Properties, and K Wah International Holdings, all of which rank among Hong Kong’s largest homegrown builders.
Late last month the Lands Department had revealed the amounts of the rival bids for December’s Mansfield Road tender, which showed that Wharf had outbid the next closest contestant by 11 percent. Lifestyle International and Chongqing-based CC Land had submitted a joint bid for that earlier site, with Sino Land having joined a rival attempt together with Kerry Properties, New World Development and others.
CK Asset, Henderson, Sun Hung Kai and K Wah had also been among the runners-up for December’s Mansfield Road land sale.
Wharf’s successful bid effectively reunifies a Peak site which had once provided government housing for civil servants, and had been the subject of a cancelled land sale two years ago.
Before being split into separate parcels last year, today’s plot, together with the site sold in December, had been put up for sale in September 2018, with analysts projecting bids of up to HK$32.3 billion for the combined location.
That sale was cancelled in October of that year when all five of the bids submitted failed to meet the government’s undeclared auction minimum.
Despite setting records for the price per square foot paid at government property tenders, the pair of land sales together show how two years of social unrest and public health emergency have dented developer appetite for high-end sites.
The land premiums agreed to for the two Mansfield Road plots amount to HK$19.25 billion, or a more than 40 percent discount from analyst projections two years ago.