Wheelock Acquires Site in Hong Kong’s Soho for $127M Residential Project

Wheelock Properties has acquired its second site on Hong Kong Island in two months, having won full ownership of three ageing buildings in the city’s Central district through a compulsory sale, according to sources familiar with the deal.

The acquisition has set up Wheelock to develop a more than HK$1 billion residential project in Central’s Soho area, with the project expected to yield 40,000 square feet (3,716 square metres) of gross floor area upon completion, according to property firm Cushman & Wakefield. The sale valued the property at HK$13,225 per square foot of maximum floor area.

The developer controlled by property tycoon Peter Woo this week succeeded in obtaining the remaining stake of the properties at 47-57 Staunton Street at a valuation of HK$529 million ($67.3 million), about two years after submitting a compulsory sale application with more than an 80 percent ownership stake in each of the adjoining properties at the time.

Wheelock’s latest win followed its recent acquisition of Ventris Court, a residential tower in Hong Kong Island’s Happy Valley — valued at HK$1.73 billion — through another compulsory auction in March, with analysts expecting Wheelock to redevelop the property into a HK$3.5 billion luxury project.

Boutique Block

Wheelock’s newly acquired plots on Staunton Street, just uphill from the city’s Lan Kwai Fong entertainment district and the Center office building, is just over 10 minutes’ walk from both the Sheung Wan and Central MTR stations.

The properties could be redeveloped as a single-block residential building, with retail space spanning the ground to first floors, according to Cushman & Wakefield. Upon completion, the project could provide 53 boutique flats averaging 430 square feet each, with selling prices ranging between HK$15.5 million and HK$16.5 million per unit, said Alex Leung, senior director at CHFT Advisory and Appraisal.

With reference to nearby residential properties, including Caine Hill at 73 Caine Road and 28 Aberdeen Street, unit prices for Wheelock’s latest project could fall between HK$35,000 and HK$40,000 per square foot based on saleable area, according to Michelle Man, director of valuation and advisory at Knight Frank. This would be in line with unit prices for new homes in the area, which cost at least HK$30,000 per square foot of floor area, according to Cushman & Wakefield.

The existing buildings of Wheelock’s Staunton Street properties include two seven-storey blocks at 47 and 49 Staunton Street, which were both completed in 1968, according to a press release from Savills, which brokered the sale. Spanning numbers 51 to 57 on the same street is the six-storey Wah Yee mansion, completed in 1971.

The developer could choose to buy up neighbouring properties for a further expansion of the project, said Leung, who referred to a record from the Hong Kong land registry in 2017 showing a company to have acquired all units at 59 Staunton Street just next door to the Wah Yee mansion. That company could be a related party to the applicant in this case, he added.

Hong Kong Pipeline

In the year to date, Wheelock has continued to bulk up its residential pipeline in Hong Kong despite mass home prices seeing a 2.4 percent quarterly decline in the first three months of 2022.

Two months before its acquisition of Happy Valley’s Ventris Court in March, Wheelock was granted approval to arrange a compulsory sale to acquire the remaining stake in that residence, with the developer holding an 83.82 percent ownership interest in the property.

Wheelock’s existing projects on Hong Kong Island include the 170-unit Island Residence at 163 Shau Kei Wan Road and the 29-storey One Island South office tower in Wong Chuk Hang.

Also on Hong Kong Island, the developer in May submitted a compulsory auction application to buy the remaining stake in an industrial building in Wong Chuk Hang, which analysts expect would make way for the development of a HK$2 billion commercial project in the area.

In Kowloon’s Cha Kwo Ling area, just east of the former Kai Tak airport runway, housing units in the third phase of Wheelock’s Koko Hills project will be put up for sale as soon as the end of June, the Hong Kong Economic Journal reported.