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Hong Kong property
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Hong Kong sees record 6 failed land tenders as elevated interest rates, depressed home prices dampen demand for new plots, Colliers says

  • Only four of 10 projects launched by the government in the past 11 months drew enough bids for the tender process to continue
  • Besides jacking up development costs, the elevated interest rates have soured buying sentiment as Hongkongers wait for a more favourable time

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Construction sites in Kai Tak. The main factors [behind the lack of demand] were “the mounting pressures faced by property developers in large-scale projects,” says Dorothy Chow at Colliers. Photo: Dickson Lee
Cheryl Arcibal
Hong Kong saw a record six failed land tenders this year as high interest rates, a sluggish economy and complex development requirements diminished developers’ appetite to acquire new plots, according to Colliers.
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The sombre view of the residential property market is likely to further depress home prices in Hong Kong. Lived-in house prices recorded a 19 per cent fall in October compared to their peak in September 2021, according to the latest official data.
In total, 10 projects were launched by the government, the MTR Corp and the Urban Renewal Authority over the past 11 months. Only four of them – three residential sites and a commercial parcel – drew enough bids for the tender process to continue.
They were an 8,360 square-metre project on Po Fung Road in Tsuen Wan, which was snapped up by Kerry Properties in February for HK$1.4 billion (US$180 million), a 2,260 sq m lot in Kennedy Town, which Wheelock Properties bought for HK$1.72 billion in July, and two parcels of land in Kai Tak, with an aggregate area of 145,303 sq ft, which were won by a consortium led by Sino Land for HK$5.3 billion in September.

Meanwhile, Sun Hung Kai Properties won the tender for an 11,537 sq m commercial site in Mong Kok for HK$4.73 billion in February.

Why is Hong Kong housing so expensive?

“The primary contributing factors [to the lack of demand] were the mounting pressures faced by property developers in large-scale projects,” said Dorothy Chow, executive director, Asia, valuation and advisory services at Colliers.

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