Sino Land Enters Sole Bid for Lantau Residential Site in Hong Kong

A residential site on Hong Kong’s Lantau Island drew a single bid from local builder Sino Land at a tender that closed Friday, potentially setting the stage for a fourth withdrawn plot at government land sales in 2023.

The low-density site, an irregularly shaped plot next to a campground on Tung Chung Road in Lantau’s southern Cheung Sha area, measures 204,516 square feet (19,000 square metres) and can yield up to 81,806 square feet of gross floor area across two storeys. The land lies opposite Swire Properties’ Whitesands, a fully sold residential development.

Cheung Sha is a remote rural location that traditionally targets holiday home owners and expats, said Hannah Jeong, head of valuation and advisory services for Hong Kong at Colliers. The site is also located on slopes, requiring higher infrastructure costs.

“Given high unsold units, especially for New Territories, sites in these remote locations wouldn’t be attractive to developers,” Jeong told Mingtiandi. “Apart from Swire, Lantau South was mainly sold to mainland developers who are not active now.”

Clear Sea View

Colliers describes the lot as higher than neighbouring developments and likely to benefit from an unobstructed southern sea view. The property is a 13-minute drive from Tung Chung MTR station and a 17-minute drive from Hong Kong International Airport on Chek Lap Kok.

The market expectation before the tender opened on 17 November was in the range of HK$410 million to HK$700 million ($52.6 million to $89.8 million), translating to an accommodation value of HK$5,000 to HK$8,600 per square foot.

Sino Land bought a smaller site in the area for HK$203.9 million in 2018. That development is due to be completed next March, comprising a total gross floor area of 11,600 square feet, Jeong said.

Just two Cheung Sha projects have been completed in the past eight years: Swire’s Whitesands and Sino Ocean Group’s Mt La Vie. Whitesands, completed in 2015, comprises 28 detached houses ranging from 1,954 to 2,598 square feet, while Mt La Vie, completed in 2021, features six villas ranging from 3,730 to 8,016 square feet.

Shifting Sands

From 2017 to 2019, development sites in southern Lantau routinely drew six to 12 bids from various developers, said Alex Leung, chief surveyor at CHFT Advisory and Appraisal.

But demand for holiday homes fell due to the poor economy and multinational firms cutting budgets and employing fewer expats. “On the sale market, there were only three to four house transactions annually in the second-hand market in the last three years,” Leung told Mingtiandi.

Sino Land has been the most aggressive bidder in government land sales of late, with the developer and partners China Merchants Land and Great Eagle Holdings winning a tender last week for a project in Kowloon’s Kai Tak area with a bid of HK$1.93 billion ($250 million). A Sino Land-led consortium also won the previous land sale in Kai Tak in September.

Nonetheless, if Sino Land’s bid for the Lantau Island plot is too low, the government would not hesitate to withdraw the tender in the absence of market competition, Leung said.