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1. MTRC receives 11 bids for $5b Dream City project

2. Failed cultural-hub bidder expects call for new designs

3. Small players among 11 bidding for Dreamcity project

1. MTRC receives 11 bids for $5b Dream City project
Raymond Wang, The Standard 13 January 2005

Underground train operator MTR Corp said its residential project - Dream City, above the Tseung Kwan O station - will cost HK$5 billion to build and the tender has received 11 bids from developers.

MTRC and the winning bidder will each pay half the land premium to the government and the railway operator expects to take at least a 60 percent share of profit from the sale of flats, MTRC property director Thomas Ho said on Wednesday.

Market sources said earlier that the land premium is about HK$2.32 billion. The winning bidder must also pay the MTRC an ``entry fee'' of HK$180 million. About half the bidders are big names such as Sun Hung Kai Properties, Henderson Land Development, Cheung Kong (Holdings), New World Development, a consortium comprising Sino Land and China Overseas Land and Investment, and Wheelock Properties. Tenders closed on Wednesday.

As the MTRC will shoulder half the land premium, the tender has also lured small to mid-sized builders, including Kowloon Development, K Wah International Holdings, Chun Wo Holdings, and a consortium formed by Nan Fung Development and Wing Tai Asia.

Since the estimated premium represents HK$1,540 per square foot, surveyors said the sale price should exceed HK$4,000 psf on completion in three to four years, with expected profit margins up to 20 percent.

That will be in the upper range of prevailing prices for new apartments in Tseung Kwan O, which real estate agents said range from HK$3,000 to HK$4,000 psf.

Dream City is the first project to be launched by MTRC since it suspended new projects in 2002 in the wake of the government's attempt to prop up the ailing property market.

Dream City's first phase will offer 2,096 flats in five towers with a total area of 1.5 million square feet.

The entire project will eventually become a 50-tower complex with 21,500 apartments.

It will be developed over as many as 14 phases spread over 10 years on a 34.8-hectare site, with the first phase due for completion in 2008. raymond.wang@globalchina.com

2. Failed cultural-hub bidder expects call for new designs
ANDY CHENG, SCMP 13 January 2005

A model of the rejected design from James Law's Cybertecture International is one of those on display at the Fringe Club. SCMP photo

A failed bidder for the West Kowloon cultural project expects the government to start afresh on a design campaign, saying they had to offer more choices than the single-developer strategy.

James Law, director of Cybertecture International, yesterday officially unveiled one of 10 rejected proposals at a show at the Fringe Club in Central.

"We need more choices," said Mr Law, whose vision foundered on its lack of a canopy stipulated by the government.

"It's far too expensive. It is simply not worthwhile spending so much money on one particular feature that is not related to culture."

The exhibition of the failed bids is on show until Saturday.

Club founder Benny Chia Chun-heng said people tended to associate the cultural district project with Lord Foster's canopy design.

"But we would like to let them know about the alternatives. This may help open their minds," he said.

Cybertecture's design also involves various plots of land going to different developers, instead of a single one.

The plot ratio in his proposal is 1.79, lower than the government's suggested 1.81. The ratio is the proportion of commercial and residential floor space to the site's total area.

The design involves the construction of several buildings along the West Kowloon waterfront, each with space dedicated to cultural facilities, residential or commercial purposes.

"For example, one of the buildings could have a museum on top, while the lower floors are shopping malls. Each building will have its own style, because they are designed and managed by different developers," said Mr Law, an architect.

Meanwhile, the Swire proposal - rejected by the government because it did not include a canopy - has been chosen as a teaching aid by Alex Hui Yat-chuen, a lecturer at the Hong Kong Academy of Performing Arts (APA) and the University of Hong Kong (HKU).

He said a group of APA students visited Swire's Admiralty office this month to study the model because of their interest in performing at a new cultural hub.

Later this month, a group of HKU architecture students will go to see it.

"Many students know little about the cultural district project, but they are the ones who will be using the new facilities in future," he said, adding that students were required to write reports after the visits.

"In a lot of international architectural competitions, the rejected proposals are also displayed. There may be a single particular element in the rejected proposals that is outstanding," he said.

3. Small players among 11 bidding for Dreamcity project
ERNEST KONG, SCMP 13 January 2005

Eleven developers, about half of them smaller players, have lined up for the first phase of the $5 billion Tseung Kwan O Area 86 project.

Tenders closed yesterday for the development, one of a maximum of 14 at the future Tseung Kwan O South Station which will be part of the proposed Dreamcity residential and commercial community to be developed over the next 10 years.

MTR Corp property director Thomas Ho Hang-kwong said the second-tier developers had been able to bid because of the corporation's sweetener of paying half of any land development premium.

"The response is related to our new offer [of paying half of any development land premium]," said Mr Ho, adding that MTR would take at least 60 per cent of profits from the sale of the completed buildings because it was paying half of the premium. This compares with a 25 per cent minimum profit-sharing ratio in the corporation's Tiu Keng Leng Station development in 2002.

Mr Ho shrugged off competition from Kowloon-Canton Railway Corp's 1.81 million square foot residential project in Wu Kai Sha that will soon be up for tender, saying, "Tseung Kwan O and Wu Kai Sha are two separate markets; the response [to the tender] this time speaks for itself."

Smaller developers that have submitted bids include K Wah International Holdings, Kowloon Development, constructor-turned-developer Chun Wo Holdings, and a consortium formed by Wing Tai Asia and Nan Fung Development.

K Wah group finance director William Lo Chi-chung said MTR's terms had made residential development along the railways far more attractive for smaller firms.

"[The Tseung Kwan O project] can be even more profitable than projects in core areas," Mr Lo said.

Other hopeful developers include Sun Hung Kai Properties, Cheung Kong (Holdings), Henderson Land Development, a consortium formed by Sino Land and China Overseas Land & Investment, New World Development and Wheelock Properties.

Wharf assistant director Ricky Wong Kwong-yiu expects completed units in the project to be selling at more than $4,000 per square foot. Phase One of Tseung Kwan O Area 86 calls for the construction of 2,096 flats on five residential blocks over a 14,266 square metre site.

Developers are also keen to replenish their land banks by acquiring private sites. Sun Hung Kai Properties struck a deal recently with Church of Christ in China, owner of the Hoh Fuk Tong centre in Tuen Mun, to develop a 980,000 square foot residential project on the site.

The developer will be required to save the 70-year-old Morrison Building, which was declared an official heritage monument last year.