Staff reporter and Bloomberg A pilot initiative to get private developers build flats on government land and sell them at subsidized rates failed to take off on launch as the first tender was withdrawn after only one bid was received. The tender for the residential site in Chai Wan - Inland Lot No. 185 on Cheung Man Road - was rejected as the tendered premium by the sole bidder did not meet the government's reserve price, the Lands Department said yesterday.
Able Engineering (1627) had submitted the sole bid last Friday. The site covers an area of 5,213 square meters with a minimum gross floor area of 30,016 sq m and a maximum of 41,704 sq m for private residential purposes. It was the first tender put up under the Private Subsidized Sale Flats pilot first revealed by Chief Executive John Lee Ka-chiu during his policy address in 2022.
Under the scheme, the Chai Wan site, which is valued at HK$650 million to HK$1.48 billion, should provide at least 700 flats which should be sold at 65 percent of the market price. The eligibility of applicants of the scheme is the same as the Home Ownership Scheme,but the government will not buy any unsold flats from the developers This came as the Buildings Department approved 14 billing plans in May, including several luxury residential projects on Hong Kong Island.
Among the approvals, 30-38 Magazine Gap Road on The Peak was approved to build four blocks of two to three-story residential buildings with a total area of 48,773 square feet. The 19 Tai Tam Road project was permitted to develop a seven-story residential building with an area of 12,598 sq ft. And the site at 41-45 Perkins Road, Jardine's Lookout, has got the go-ahead to build a five-story residential building with a total area of 9,542 sq ft.
In other news, Chinese distressed builders Logan Group (3380) and KWG (1813) are close to signing a private loan to refinance a HK$10.2 billion facility that backed the development of The Corniche, a luxury property in Hong Kong, said people familiar with the matter. The borrowing, arranged by JP Morgan, is likely to be signed with a group of investors by early next week, according to the people.
Singapore-based private equity firm RRJ Capital, American investment manager Pacific Investment Management and Deutsche Bank are among the largest lenders in the loan, said the people. The original HK$10.2 billion project loan for The Corniche is set to mature on August 25, Bloomberg-compiled data show.
The facility has around HK$8.6 billion in outstanding principal and interest, said one of the people. The developers have been seeking financing to fully cover the existing deal, but the new borrowing's final amount hasn't been decided yet, added the people.
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