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21 Jul 2011, Thursday
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Caution expected on Tung Chung residential site (SCMP)
Surveyors expect developers to be cautious while bidding for a large residential site in Tung Chung that is designated for small flats. They estimate the 273,406-sq-ft site to fetch HK$3.3-3.48 billion, representing an accommodation value of HK$2,389-2,500 per sq ft.
Surveyors believe the Home Ownership Scheme, which the government might resume, could create direct competition for such residential projects if the government does move in that direction.
Meanwhile, surveyors expect a 71,042-sq-ft commercial site in Kowloon Bay to generate strong responses and fetch HK$2.98-3.3 billion as office rents are expected to keep rising.
Hopewell hopes to lift asset value by mall renovation (SCMP)
Hopewell Holdings (0054.HK) would renovate its Panda Place shopping mall in Tsuen Wan and change its tenant mix in the latest move to enhance the asset over the next two years.
More than 50% of existing tenants would move out, making space for new tenants. The renovation will cost more than HK$10 million. Rentals are expected to experience a double-digit growth when the refurbished mall reopens in the fourth quarter of 2012.
Hopewell has signed agreements with Aeon Stores, the operator of Jusco, to open a two-floor Jusco Japanese department store in Panda Place covering a gross floor area of 120,000 sq ft. The store will include a 50,000-sq-ft supermarket.
China housing bubble a nationwide threat (Standard)
China is facing a nationwide property bubble due to speculation in the residential sector, according to Chinese Academy of Social Sciences. Home prices have jumped to unreasonably high levels despite high vacancies of new flats.
Although the rise in flat prices in big cities eased last month, they jumped sharply in second and third-tier cities. Prices in 12 second and third-tier cities rose more than 7% in June from a year ago.
Meanwhile, a think tank says many projects launched by local governments have not been able to generate cash in the short term. Local officials are under pressure to seek other sources of financing.
Hong Kong Retail Property Activity (HKEJ)
Retail Property Sales
DistrictDevelopment Tower/Floor/Unit
(sq ft)
(HK$ million)
(HK$ per sq ft)
*Causeway Bay4 Jones StreetGround floor unit500$18$36,000
*Tsim Sha TsuiYiu Pont House, 12 Knutsford TerraceGround floor unit2,300$73$31,739
* Market news
Hong Kong Office Property Activity (HKET)
Office Property Sales
(sq ft)
(HK$ million)
(HK$ per sq ft)
*Central1 Lyndhurst Tower12th floor4,005$44.25$11,049
* Market news
Stock Market (20 Jul 2011)
Hang Seng Index: 22,003.69 (+101.29)
Shanghai (SSE) Composite Index : 2,794.21 (-2.78)
Shenzhen (SSE) Composite Index : 1,219.46 (+2.43)
Interest Rates (20 Jul 2011)
Hong Kong Prime Rate : 5.00% (HSBC)
People's Bank of China 3-year Time Deposit Rate : 5.00%
People's Bank of China 1 to 3-year Loan Rate : 6.65%

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Produced by Research Department of Knight Frank 2011