Henderson Land Secures New Central Harbourfront Site 3 For HK$50.8bil

HONG KONG – Nearly a year after the city’s local government launched the tender for the New Central Harbourfront Site 3 that spans 516,312 sq ft, the trophy commercial land plot was acquired by Henderson Land Development, which submitted a record bid of HK$50.8 billion ($6.5 billion), reported Mingtiandi on Wednesday afternoon (3 November, SGT).

The bid for the commercial site, which leads to Hong Kong’s renowned Star Ferry, also surpassed expectations of real estate experts.

“This is a historic record high lump sum for a single development site in HK, and a mega sum from any investment perspective. The financial outcome is on the mid-upper end of the market expectations band of HK$35 billion to HK$66 billion,” commented Rita Wong, Head of valuation and consulting for Greater China at CBRE.

With that record bid, the developer is paying roughly HK$31,750 psf for the site adjacent to the IFC complex in Central. It is also allowed to build roughly 1.6 million sq ft of commercial space. Of this, 500,000 sq ft is allocated for office space, while the remaining area will be set aside for retail and public areas. Apart from the leasable area, Henderson Land is mandated to provide public space measuring at least 269,000 sq ft.

Notably, the developer won against 5 other bids in the tender, which was carried out via a “two-envelope” process to maximize the government’s profits from the site and ensure a landmark project is built there.

“The government hopes that this project can optimise development space by providing the maximum possible commercial floor space to address the city’s strong demand for prime Grade A offices, while creating a world-class harbourfront with quality public open space and pedestrian-oriented connectivity,” said a representative from the city government.

However, the New Central Harbourfront Site 3 is subject to height restrictions which caps the project 16 metres in height on its eastern side and 50 metres at the western side. This means Henderson Land will need to construct a more horizontal complex, in addition to building structures bridging roads running through the site.