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May 18, 2017

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Home » Business » Real Estate

HK tycoon pays record US$3b for prime plot

A Hong Kong tycoon has paid US$3 billion for a prime commercial lot, a city record according to analysts, as costs in one of the world’s most expensive metropolises continue to soar.

The price tag — which works out at around US$1 million per square meter — for the rare plot of land in Hong Kong’s bustling Central district can partly be explained by fierce competition for premium space, said Jackson Wong, of Huarong International Securities.

“It is pretty crazy,” he said of the sum paid for the land, currently occupied by a multi-story car park.

Wong said it was a commercial land sales record and would be seen as a yardstick for future deals.

“However, this kind of supply is once in a blue moon,” he added.

Commercial and residential property prices in Hong Kong have been fueled by an influx of money from Chinese mainland investors and developers.

Critics also accuse the government of having close ties with developers.

The 2,880-square-meter plot in Central was sold off by the government to Henderson Land, owned by the city’s second-richest man, Lee Shau-kee.

It was the first premium commercial lot to come up in Central since 1996.

The eight other bidders included the city’s richest man Li Ka-shing and one Chinese mainland firm, according to a government statement.

Henderson Land said it would develop the site into an office building with retail facilities, set to be finished around 2022.

“The company is optimistic of the long-term prospect of this investment,” it said in a filing to the Hong Kong stock exchange.

Property group CBRE said in March that the Central district was home to the world’s highest priced office market, ahead of Beijing’s Finance Street, London’s West End and Midtown Manhattan in New York.


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