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Peak house expected to fetch record price

HONG KONG: Sellers of a luxury house on The Peak are confident of achieving a record price following the positive result at this week's land auction.

The Shang family, owners of the China Can Company, appointed property agency Jones Lang LaSalle to conduct a tender for the 62-year-old house at 20 Peak Road. The tender will close on Sept 15.

In an auction on Wednesday, July 28, a site at Mount Nicholson Road on The Peak sold for the third-highest price on record in Hong Kong — HK$10.4 billion (RM4.27 billion).

"The accommodation value [land price per square foot] has a great opportunity to break the record for a residential site in town," Joseph Tsang Hon-ping, international director at the property agency, said of the Peak Road site.

The most expensive site sold was 35 Barker Road on The Peak, for which Henderson Land chairman Lee Shau-kee paid HK$68,228 per  sq ft last month.

As the development potential of the project is small, Tsang expects the tender will only attract tycoons keen to build their dream home, rather than commercial developers.

Lanbase Surveyors director Chan Cheong-kit estimates the 20 Peak Road site to be worth between HK$800 million and HK$900 million as it is in a prime location with panoramic views of Victoria Harbour and Central.

"The land price per sq ft may reach HK$68,229, similar to the site acquired by Lee Shau-kee," he said.

Based on the land lease, the site cannot accommodate more than one residence. The buyer would have to pay a land premium levy to the Lands Department to remove the development restriction.

A surveyor estimated the levy could cost more than HK$100 million if the buyer wants to build three or four houses on the 25,764 sq ft site.

At present, there is a two-storey detached house with a net area of 6,020 sq ft.

The house, which was built in 1948, has been vacant for a few years and is shrouded in lush green foliage, but it has clear views of Central and the harbour area.

Based on the outline zoning plan, the site could accommodate a single very large property with a maximum total gross floor area of 12,882 sq ft.

Jones Lang LaSalle will promote the site on the mainland after a number of prospective buyers expressed an interest.

Property agents said the surging high-end residential prices and strong sales of sites had encouraged many vendors to release their luxury properties for sale in recent months.

One of those properties is the five-storey detached house and an adjacent five-storey residential block at 20 and 22 South Bay Road in Repulse Bay, estimated to be worth about HK$1 billion.

The vendor has appointed property consultant Knight Frank to put the properties up for tender, which closes on August 18.

Wednesday's auction result prompted flat owners to raise their asking prices, according to Midland Realty director Andy Ho.

He said owners in Kowloon Tong had raised prices by 3 to 5% after the auction.

A Sino Land spokesman said prices at its new Tai Kok Tsui project, The Hermitage, would be raised shortly.

The 964-flat development has sold more than 750 flats since it launched last month, which helped the developer generate more than HK$9 billion.

The developer estimates 20% to 25% of the buyers came from the mainland. — South China Morning Post
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