SHKP Wins New Territories North Land at 44% Above Valuation Cap Hong Kong Becomes Shenzhen’s Backyard, Sparks Heated Debate

Plagued by political problems in Hong Kong, real estate was once in the doldrums, but one of Hong Kong’s four major property developers Sun Hung Kai Properties yesterday to 8.614 billion Hong Kong dollars (the same below, equivalent to about 919 million euros) bid for a piece of land in the northeast of the New Territories Gu Dong, 79% to 44% higher than the market valuation. Analysts pointed out that the winning bid aggressive, reflecting the developers have confidence in this piece of land adjacent to Shenzhen, China. The news even made the netizens hot news agency reported that Chinese real estate developers to Hong Kong as the back garden of Shenzhen, the future of mainland people can live in Hong Kong, and then commute to work in Shenzhen.

April 27, the sky unveiled the target Gu Dong North land, is the first official land in the Gu Dong development area, the site area of 200,000 square feet, is expected to build 1,199,000 square feet of floor space, is expected to provide about 1330 residents. With the winning bid of SHKP, the land price per square foot is about $7,184, which is not only higher than the market valuation ceiling of about 44%, but also about 97% higher than the price per square foot of the adjoining land after another property developer made up the land price three years ago.

The deputy managing director of SHKP, Mr. Lui Ting, responded to media inquiries by saying that the project will be a railroad interchange station in the future, the site is in a good location, and there will be enough living and employment support in the same area in the future, and the group plans to build small and medium-sized units with a total budget investment of about 18 billion yuan. In addition, analyst Leung Pui-wong estimated that the project will be completed at a price of about 18,000 yuan per square foot when the project’s residential sales price is projected at the winning land price.

The news triggered netizens to pay attention to Reuters the day before a report entitled “Chinese property developers see Hong Kong as Shenzhen’s backyard”, and the report was translated and summarized into a post to remind Hong Kong people. The post said the report quoted a mainland developer who had purchased land in the northern New Territories, said the industry’s long-term view of Shenzhen as the center of the region, while Hong Kong will become a “peripheral area”, the future mainlanders can live in Hong Kong, where property prices are cheaper, and then travel to work in Shenzhen.

The report cited the Hong Kong Lands Department information pointed out that since 2019, the six residential land auctions in Hong Kong’s North District, half of the mainland developers voted for; in addition, China Evergrande Group even by the Hong Kong Henderson hands to buy the floor space of 250,000 square feet in Yuen Long. A real estate consigliere revealed that the developer intends to build about 200 units at a price of 10,000 yuan per square foot and plans to sell them at 20,000 yuan per square foot, the selling price is still lower than the current property price of about 30,000 yuan per square foot in Shenzhen. The real estate agent also revealed that the real estate agent to live in Shenzhen, the mainlanders sales target.

Reports continue to say that, according to the United Property Information, the first two months of this year, the mainlanders came to Hong Kong to buy property cases than a year ago increased by 40%, more than 80% of the transaction amounted to more than 50 million yuan. The number of mainlanders coming to Hong Kong in the previous year, the number of national industry fell sharply, is now back up, should be optimistic that after the epidemic can pass again.

Mainlanders are happy to go to the New Territories North shopping or home ownership for many years has caused dissatisfaction among Hong Kong people, that too many mainlanders to Hong Kong affect their lives, but also raised prices. Netizens who summarized the foreign news reports worry that when the Hong Kong property market will only serve the Greater Bay Area, the Hong Kong government’s so-called policy of increasing land supply and suppressing property prices, I’m afraid that ultimately only for the “new Hong Kong people” services.