Local developers bid more aggressively as Chinachem and The Wharf snatched two GLS sites.
The aggressive property acquisition of big-time Chinese developers in Hong Kong appears to have slowed down as local and smaller players are stepping up to the challenge and snapping residential sites by tender, according to JLL’s residential sales market monitor.
Local developer Chinachem snatched a site in Kwun Tong whilst The Wharf bought another site at Kowloon Tong which represent the first two sites released as part of the government’s land sale programme.
This comes as a surprise as developers from PRC snapped 70% of residentials sites tendered back in 2017.
“Some associated the dwindling appetite of PRC developers in the Hong Kong property market to capital control measures as well as the more aggressive bidding strategy of local developers,” said JLL Director of Capital Markets Henry Mok.
Analysts, however, are bullish that Chinese developers may soon recover their lost market share as a growing trend reveals that they are actively seeking investment opportunities elsewhere in the private market via en-bloc, bulk-purchase or amalgamation opportunities.
In fact, PRC-backed developer Fullsun International Holdings made its local debut after buying 6 La Salle Road at Ho Ma Tin for $920m from Easyknit International Holdings.
China Aoyuan Property also purchased five units at Yin Yee Mansion at Mid-Levels West for $131m for amalgamation purposes.
“It would be no surprise to see a growing footprint of smaller-sized PRC developers in the Hong Kong market, and the potential could be huge,” JLL noted, adding that there are 103 listed Chinese companies on the Hong Kong STock Exchange under the property development sector.
Photo from MichaelJanich at the English language Wikipedia, CC BY-SA 3.0
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