The plot of land at the junction of Lau Yip Street and Chung Yip Road in Yuen Long, which has been won by CK Asset Holdings. Photo: May Tse

SINGAPORE (EDGEPROP) - CK Asset Holdings won a tender for a land parcel at Yuen Long in the New Territories, as it beat 15 rivals with a higher than expected bid amid a sizzling housing market in Hong Kong. (See also: Hong Kong developers buy US$193.5 million worth of own shares in bid to support market, boost confidence)

Hong Kong tycoon Victor Li Tzar-kuoi's company bid HK$716 million ($125.1 million) for the land at the junction of Lau Yip Street and Chung Yip Road, which can yield a gross floor area of 78,575 sq ft, the Lands Department said on Tuesday evening. The price per square foot works out to about HK$9,112.

CK Asset paid 14 per cent more than the top end of market estimates for the plot, said James Cheung King-tat, a surveyor at Centaline Surveyors.

"Developers are bullish on the long-term outlook of the market," he said. "A combined 16 bids for the land showed that competition would result in a price higher than market expectations."

Other bidders for the land parcel included China Land Resources Development, Cifi Property and Grand Harvest (HK) Development.

Grace Woo Chia-ching, executive director of CK Asset, said in a statement that the developer would build low-rise luxury villas on the land.

Cheung said he expects CK Asset to price the villas between HK$15,000 and HK$16,000 per square foot.

Bidding for land in Hong Kong is expected to be fierce in the July to September quarter, as the government plans to offer only two parcels for public tender in the period, which can only provide 200 flats in an undersupplied housing market.

Aside from the Yuen Long parcel, the other plot to be offered for tender is in Kowloon Tong.

The 200 flats from the two tenders represent only 4 per cent of the total supply of 5,400 units targeted in the quarter, and is less than the average number of flats in one building block within the Kingswood Villas housing estate in Tin Shui Wai.

The closely watched Centa-City Leading Index hit a two-year high in the first week of August, buoyed by the economic recovery and control over the coronavirus outbreak in the city.

The gauge of lived-in homes compiled by Centaline Property Agency rose for the third consecutive week to hit 191.3, according to data released on Friday. That is marginally higher than the 190.48 reached in June 2019.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2021 South China Morning Post Publishers Ltd. All rights reserved.