Mapletree awarded Kowloon East prime commercial site with HK$3.769b bid

Location for new Grade-A office building.

Mapletree Investments Pte Ltd (Mapletree) announced that it has been awarded a prime site in Kwun Tong, Kowloon (Hong Kong SAR) at a price of HK$3.769 billion (approximately S$619 million).

Designated primarily for commercial purposes, the plot spans a site area of about 5,112 square metres (55,026 square feet). The site is flanked by Wai Yip Street and Kwun Tong Road, and is strategically located within Kowloon East, an existing key office cluster of Hong Kong SAR, which has also been earmarked as the new Central Business District (CBD2) to support Hong Kong SAR’s long-term economic development, said Mapletree.

On securing the site, Mapletree plans to develop a Grade-A office building with a total Gross Floor Area (GFA) of 61,344 square metres (660,301 square feet), at a total development cost of more than HK$6 billion (approximately S$1 billion).

The planned development will be well-positioned to cater to the growing demand for quality, large and column-free office space to serve as the corporate headquarter and/or for backroom operations, said Mapletree.

"There has been a wave of relocation activities as financial institutions, insurance and logistics companies have started to consolidate their operations in this area. The site enjoys good traffic flow and is within walking distance from Ngau Tau Kok MTR station. The potential underground link to Ngau Tau Kok MTR station and the waterfront promenade would further enhance connectivity and accessibility to the site, and help channel both office and retail needs in the locality to the development which is projected to complete by 2017," said Mapletree.

Commenting on the award, Mr Hiew Yoon Khong, Group Chief Executive Officer of Mapletree said, “This is the Group’s second land award in Hong Kong SAR in 12 months, the earlier being the successful bid for a logistics site in Tsing Yi. We are excited at the potential this good-sized site presents and it gives us the opportunity to develop Mapletree’s first greenfield commercial development in Hong Kong SAR. Given the demand for good quality office space in Kowloon, we plan to draw on our experience, particularly in Singapore, in delivering outstanding commercial projects in the region”.

Mapletree’s planned commercial project bodes well with the positive outlook of Hong Kong SAR’s office sector. Hong Kong SAR has been witnessing low vacancy rates in the various major office clusters – Central, Wanchai/Causeway Bay and Kowloon East. There will also be limited Grade-A office supply coming on-stream over the next five years against the increasing expansion demand from businesses particularly in the non-financial sectors.

In addition to the Tsing Yi logistics site, Mapletree Group’s portfolio in Hong Kong SAR consists of the landmark Festival Walk retail and office property, held by Mapletree Greater China Commercial Trust, and eight logistics properties under Mapletree Logistics Trust.