8th January 2025 – (Hong Kong) The Government announced yesterday its quarterly land sale programme for the fourth quarter of 2024-25, covering the period from January to March 2025.
The Secretary for Development, Ms Bernadette Linn, revealed that during this quarter, the Government will tender a residential site located in Area 106B of Tung Chung New Town Extension. This site is anticipated to offer a total gross floor area of approximately 37,200 square metres, which could accommodate around 745 flats. Although this site was not initially included in the Land Sale Programme (LSP) for this financial year, the Government has deemed it an appropriate time to incorporate it and proceed with the tender process. This decision follows an assessment of the current market conditions and feedback from stakeholders, as well as the recent successful tender by the MTR Corporation Limited for a nearby site and the expected completion of public housing in the vicinity.
Area 106B boasts a prime harbourfront location and will be accessible via the future Tung Chung East Station. To facilitate interest from the real estate sector, the tender for this site will feature straightforward conditions and no requirement for the construction of Government facilities. Additionally, as the site is situated on reclaimed land, developers will not need to undertake further site formation works, potentially lowering development costs.
The Government previously tendered Area 106B in September 2023, but the premiums offered did not meet the reserve price, leading to the cancellation of the tender. In response to market feedback, the Government has enhanced the tender conditions for this re-tender. The site’s infrastructural capacity has been reassessed, allowing for the development of 745 units with smaller average sizes, which is expected to improve the project’s profitability. Furthermore, a new road to the site is nearing completion, enhancing accessibility and facilitating construction.
In addition to this, the Urban Renewal Authority plans to tender its development project on Shantung Street/Thistle Street this quarter, which will yield around 340 flats. For private development and redevelopment projects, two are anticipated to complete their lease modifications in the fourth quarter, offering a total of 13 flats.
“Considering all sources of land supply, the total private housing land available in this quarter will support around 1,110 units. Together with the supply from the first three quarters, the overall private housing land supply for this financial year is projected to support approximately 8,340 units, equating to about 63% of our annual target of 13,200 units,” Ms Linn explained.
She acknowledged that the total private housing supply for this financial year may fall short of the annual target, a development that is both expected and reasonable. The high interest rate environment and geopolitical factors have influenced investment and cash flow, leading to decreased activity in local asset markets, and developers have been cautious in their bidding for sites. Despite recent adjustments in interest rates and a gradual market recovery, the Government believes that developers will require additional time to recalibrate. As such, it remains prudent and pragmatic in its land disposal strategy this quarter, even with a substantial inventory of available sites.
The Government will maintain its commitment to a cautious and adaptable approach in land disposal, adjusting strategies in response to market conditions to address housing and economic development needs.
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