Wang On Properties has announced its purchase of a site in Kowloon for a HK$1.3 billion ($180 million) residential project, following the successful launch of a boutique residential project in the New Territories last month.
Adding to its land supply acquired through government auctions and compulsory sales, the Hong Kong-listed developer last week purchased the site at 26-48 Ming Fung Street, valued at HK$805 million ($103.4 million), through a compulsory sale for redevelopment.
Should the property be approved for development as a single site, it could yield more than 70,000 square feet (6,503 square metres) of new construction area, said Charles Chan, managing director at Savills. The approval would bring the price per square foot up to HK$11,500 ($1,480).
The acquisition takes place amid an upswing in the residential market, with the first half of 2021 seeing a monthly average of 6,689 home sales, compared with the 4,562 average in the same period last year, according to property consultancy JLL.
Ming Fung Makeover
The property on Ming Fung Street occupies a site area of 9,630 square feet at the junction of Sheung Fung and Fei Fung streets in Wong Tai Sin district, an area in the north of Kowloon.
Wang On Properties plans to redevelop the site into a 230-unit project under its existing boutique residential brand series, The Met, Hong Kong Economic Times reported.
The group’s latest purchase comes just over a week after the developer sold 143 units at The Met.Azure in Tsing Yi, an island in the New Territories, priced between HK$3.89 million and HK$4.61 million, with 13 buyers bidding for every available flat.
The newly-purchased site is in the residential (Group A) zoning and houses three buildings completed between the years 1962 and 1965.
At 26-32A Ming Fung Street is the Kin Fung Mansion, an eight-storey commercial and residential building with retail shops on the ground floor. Numbers 34 and 36 on the same street host a six-storey tenement building, Fung Wong Mansion, and at 38-48 Ming Fung Street is another six-storey building with retail shops on the ground level.
A subsidiary of Wang On bought 79 units from a number of buildings on the site for HK$378 million in November 2018. Less than a year later, the group applied to the Lands Tribunal for a compulsory sale order, according to a filing with the Hong Kong stock exchange.
With Wang On holding 83.5 percent of the project, the site was approved for a compulsory auction in July this year, a month before it was sold to the developer in August through a deal brokered by Savills.
Restocking the Land Bank
Through its acquisitions of old buildings, Wang On continues to explore potential redevelopment projects in Hong Kong.
As of 31 March, the group had replenished its land bank with 228,000 square feet of aggregate gross floor area, Wang On said in its 2021 annual report.
In January, the group acquired two plots of land less than 50 metres from each other through compulsory sales, at 50-62 Larch Street and 6-8 Lime Street in Ap Lei Chau. The sites can yield a gross floor area of 61,500 square feet and are undergoing demolition work, according to the report.
On 28 October last year, Wang On and the Shanghai-based developer CIFI jointly acquired a pair of adjacent properties in Fortress Hill with plans to develop an HK$2.6 billion commercial and residential project, in which Wang On would hold a 40 percent stake.
This acquisition followed the developers’ joint venture in Kowloon East two years earlier in 2018. That project, Maya by Nouvelle, launched in the last quarter of 2020 and had sold 294 out of 326 units as of March this year.
Wang On’s plan to build its 230-unit residence comes amid an uptick in home sales, with buyers snatching up units from newly-launched projects in the city.
In the weekend that followed Wang On’s launch of The Met.Azure, 302 of 350 units were sold at Sun Hung Kai Properties’ Wetland Seasons Bay on the first day of the launch, with 33 bids competing for each available unit.