HNA buys sec­ond site near old Hong Kong air­port

China Daily (Hong Kong) - - BUSINESS | MARKETS - By BLOOMBERG

A unit of HNA Group Co out­bid Hong Kong de­vel­op­ers, in­clud­ing Che­ung Kong Prop­erty Hold­ings Ltd, with an HK$5.4 bil­lion ($697 mil­lion) of­fer for gov­ern­ment land in the for­mer Kai Tak air­port area, adding to a $1.1 bil­lion win­ning bid last month for an­other site nearby.

It was one of the most hotly con­tested land ten­ders this year, with home prices near their record high in Hong Kong. The ten­der at­tracted 21 bid­ders in­clud­ing Hong Kong’s Whee­lock Prop­er­ties Ltd and Sun Hung Kai Prop­er­ties Ltd, as well as main­land buy­ers in­clud­ing China Vanke Co, ac­cord­ing to a Lands Depart­ment an­nounce­ment on Mon­day.

The deal is the lat­est over­seas foray for Hainan-based HNA, which has spent more than $30 bil­lion on a deal­mak­ing spree this year. The com­pany in Novem­ber won a mil­lion HK$8.84 bil­lion bid for the first site in the Kai Tak area, the most paid for a piece of gov­ern­ment land in three­and-a-half years. The site is des­ig­nated for pri­vate res­i­den- tial de­vel­op­ment.

The price works out to HK$13,600 per square foot of saleable area, HK$100 more than what HNA paid last month. The cost, while ex­pen­sive com­pared with other land pur­chases this year, is “a rea­son­able deal if they con­sider to merge the two sites to­gether to de­velop a huge lux­ury res­i­den­tial pro­ject,” said Thomas Lam, head of val­u­a­tion and con­sul­tancy in Hong Kong at Knight Frank LLP.

Hong Kong’s res­i­den­tial prices have re­bounded from a six­month slump, de­spite gov­ern­ment mea­sures to cool the mar­ket. They are just 1.2 per­cent be­low their all-time high reached in Septem­ber of last year.

HNA, led by avi­a­tion ty­coon Chen Feng, op­er­ates air­lines, ho­tels and tourism busi­nesses and is pur­su­ing an ag­gres­sive ex­pan­sion to cap­i­tal­ize on an an­tic­i­pated surge in Chi­nese out­bound traf­fic.

the cost of the of­fer by a unit of HNA Group Co for the gov­ern­ment land in the for­mer Kai Tak air­port area

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