[hkskyline]

Island Lodge sets new benchmark for district
7 November 2007
South China Morning Post

Strong demand for flats in Island Lodge in North Point has led to some units fetching more than HK$13,000 per square foot, setting a new price benchmark for a single residential block in an old residential area.

Island Lodge, developed by Swire Properties, was launched at the weekend.

Riding on the wave of positive sentiment, owners in the area immediately raised their asking prices by up to 10 per cent, according to agents.

"At the moment, Island Lodge has achieved the highest transaction prices for a single block in North Point," said Freddy Wu Yat-fat, the chief executive of Hong Kong Property Services.

Given the age of the residential area, many homeowners living there had already cleared their mortgages, said Mr Wu, and upgrade demand was relatively strong.

"So, residents are willing to pay a premium for a quality new residential project, particularly with sea views," he said.

However, only units above the 30th floor would have unblocked views of the harbour, he said.

Island Lodge is located behind the former North Point Estate site, which is on the waterfront. Housing blocks of up to 100 metres high are expected to be built on the site.

Since it might take five to 10 years for the former North Point Estate site to be redeveloped, owners of units on lower floors of Island Lodge would enjoy the sea view for a while, Mr Wu said.

However, the uncertainty has not bothered buyers.

One speculator was said to have reaped more than HK$1.4 million from reselling a 1,039 square foot unit for HK$8.4 million before completing his initial transaction. The unit was bought from Swire for HK$6.96 million last Friday.

Mr Wu confirmed the vendor had bought the unit through Hong Kong Property and then on-sold it, but he would not reveal the prices at which the two deals were done.

Swire chairman Keith Kerr said on Monday that the firm sold 100 units at an average of HK$9,000 per square foot when they were put on sale on Friday.

The transaction prices were 50 per cent higher than the average HK$6,000 per square foot achieved at Island Place, a nearby residential project also built by Swire.

The 45-storey, 184-unit Island Lodge offers flats that range in size from 800 to 1,200 sq ft. About 40 per cent are two-bedroom units, while the rest have three or four bedrooms.

Andy Chong Siu-ping, a director at Ricacorp, said transactions in North Point had returned to normal after the market turned quiet during the weekend with the sale at Island Lodge the focus of attention.

"If home-seekers now shift to the secondary market looking for less expensive flats, they will find owners have marked up their asking prices," Mr Chong said.

Mr Chong said sellers were growing bullish about the market outlook and were now inclined to hold back from offering their units for sale in anticipation of further price rises.