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1. Hongkong Land signs up new tenant at Chater House

2. Housing policy lifts confidence

3. Bridge to Zhuhai will have little impact on river flow, study finds

4. Building plans approved in October

1. Hongkong Land signs up new tenant at Chater House
SOPHIA WONG, SCMP 17 December 2002

Franklin Templeton Investments (Asia) has emerged as another major tenant of Chater House in Central, taking up 18,397 square feet of grade-A office space from Hongkong Land.

Raymond Chow, executive director of Hongkong Land, said the deal reflected a continuing demand for world-class offices in prime locations, quality management and competitiveness.

Estate agents said Hongkong Land had offered some sweeteners, effectively representing a rent reduction, to lure its new tenant.

Mr Chow did not comment on the rental.

Estate agents said there was fierce competition for tenants among landlords of grade-A office space as ample new supply was coming on stream.

Two International Financial Centre, comprising 1.46 million sq ft of net office space, due to be completed next year, is being seen as a major new competitor of Chater House.

Mr Chow said Franklin Templeton Investments would consolidate its various local operations, now spread across a number of offices, on the 17th floor of Chater House from February. The move followed a review of the company's operational requirements and options in Central.

The commitment by Franklin Templeton, one of the world's largest investment management organisations, demonstrated that customers saw the benefits of moving into world-class and well-managed offices in prime locations even in today's challenging business conditions, he said.

"Since the beginning of the year, Hongkong Land has secured close to 50 new office tenants for its Central portfolio," he said.

"Our emphasis on professionally meeting our customers' needs and providing high-quality services pays off, especially in competitive markets."

Country head of Franklin Templeton Investments, Jed Plafker, said: "We saw compelling reasons for relocating and consolidating our Hong Kong operations, and we selected Chater House because of its excellent location, its world-class design and facilities that allow for highly efficient use of space and maximum flexibility in services."

Jones Lang LaSalle, the agent which handled the transaction, said the deal reflected revived demand from leading financial institutions for grade-A office space in Central.

United States financial giant JP Morgan signed on as Chater House's anchor tenant in October last year, signing a 10-year agreement for the top 11 office floors.

JP Morgan is paying more than HK$60 per square foot a month for a total of 207,000 sq ft.

Chater House, Hongkong Land's latest office development, has a gross floor area of 498,000 sq ft, with 86 per cent efficiency.

It includes 81,000 sq ft of retail space.

Hongkong Land is Central's biggest office landlord. The company owns about five million sq ft of commercial properties there, of which about 95 per cent is occupied.

Franklin Templeton Investments (Asia) has emerged as another major tenant of Chater House in Central, taking up 18,397 square feet of grade-A office space from Hongkong Land.

Raymond Chow, executive director of Hongkong Land, said the deal reflected a continuing demand for world-class offices in prime locations, quality management and competitiveness.

Estate agents said Hongkong Land had offered some sweeteners, effectively representing a rent reduction, to lure its new tenant.

Mr Chow did not comment on the rental.

Estate agents said there was fierce competition for tenants among landlords of grade-A office space as ample new supply was coming on stream.

Two International Financial Centre, comprising 1.46 million sq ft of net office space, due to be completed next year, is being seen as a major new competitor of Chater House.

Mr Chow said Franklin Templeton Investments would consolidate its various local operations, now spread across a number of offices, on the 17th floor of Chater House from February. The move followed a review of the company's operational requirements and options in Central.

The commitment by Franklin Templeton, one of the world's largest investment management organisations, demonstrated that customers saw the benefits of moving into world-class and well-managed offices in prime locations even in today's challenging business conditions, he said.

"Since the beginning of the year, Hongkong Land has secured close to 50 new office tenants for its Central portfolio," he said.

"Our emphasis on professionally meeting our customers' needs and providing high-quality services pays off, especially in competitive markets."

Country head of Franklin Templeton Investments, Jed Plafker, said: "We saw compelling reasons for relocating and consolidating our Hong Kong operations, and we selected Chater House because of its excellent location, its world-class design and facilities that allow for highly efficient use of space and maximum flexibility in services."

Jones Lang LaSalle, the agent which handled the transaction, said the deal reflected revived demand from leading financial institutions for grade-A office space in Central.

United States financial giant JP Morgan signed on as Chater House's anchor tenant in October last year, signing a 10-year agreement for the top 11 office floors.

JP Morgan is paying more than HK$60 per square foot a month for a total of 207,000 sq ft.

Chater House, Hongkong Land's latest office development, has a gross floor area of 498,000 sq ft, with 86 per cent efficiency.

It includes 81,000 sq ft of retail space.

Hongkong Land is Central's biggest office landlord. The company owns about five million sq ft of commercial properties there, of which about 95 per cent is occupied.

Franklin Templeton Investments (Asia) has emerged as another major tenant of Chater House in Central, taking up 18,397 square feet of grade-A office space from Hongkong Land.

Raymond Chow, executive director of Hongkong Land, said the deal reflected a continuing demand for world-class offices in prime locations, quality management and competitiveness.

Estate agents said Hongkong Land had offered some sweeteners, effectively representing a rent reduction, to lure its new tenant.

Mr Chow did not comment on the rental.

Estate agents said there was fierce competition for tenants among landlords of grade-A office space as ample new supply was coming on stream.

Two International Financial Centre, comprising 1.46 million sq ft of net office space, due to be completed next year, is being seen as a major new competitor of Chater House.

Mr Chow said Franklin Templeton Investments would consolidate its various local operations, now spread across a number of offices, on the 17th floor of Chater House from February. The move followed a review of the company's operational requirements and options in Central.

The commitment by Franklin Templeton, one of the world's largest investment management organisations, demonstrated that customers saw the benefits of moving into world-class and well-managed offices in prime locations even in today's challenging business conditions, he said.

"Since the beginning of the year, Hongkong Land has secured close to 50 new office tenants for its Central portfolio," he said.

"Our emphasis on professionally meeting our customers' needs and providing high-quality services pays off, especially in competitive markets."

Country head of Franklin Templeton Investments, Jed Plafker, said: "We saw compelling reasons for relocating and consolidating our Hong Kong operations, and we selected Chater House because of its excellent location, its world-class design and facilities that allow for highly efficient use of space and maximum flexibility in services."

Jones Lang LaSalle, the agent which handled the transaction, said the deal reflected revived demand from leading financial institutions for grade-A office space in Central.

United States financial giant JP Morgan signed on as Chater House's anchor tenant in October last year, signing a 10-year agreement for the top 11 office floors.

JP Morgan is paying more than HK$60 per square foot a month for a total of 207,000 sq ft.

Chater House, Hongkong Land's latest office development, has a gross floor area of 498,000 sq ft, with 86 per cent efficiency.

It includes 81,000 sq ft of retail space.

Hongkong Land is Central's biggest office landlord. The company owns about five million sq ft of commercial properties there, of which about 95 per cent is occupied.

2. Housing policy lifts confidence
KENNETH KO and SOPHIA WONG, 17 December 2002

Primary residential sales this year are set to surpass previous years' sales as the government's new housing policy boosts market confidence.

Analysts say market sentiment may improve further in the coming year but sufficient supply means there is no room for developers to raise prices.

Centaline Property Agency research and marketing senior manager Wong Leung-sing said primary flat sales in the first 11 months of this year totalled 24,905.

This figure might rise to 28,000 by year end, he said, the highest total since 1998, when many developers aggressively offloaded inventories as they were pessimistic about the market.

"A total of 30,500 primary flats were snapped up by home-buyers within 12 months after the halt of Home Ownership Scheme flat sale in October last year," Mr Wong said.

He said the market could absorb 35,000 or more new residential units in the coming year as the government adopted a series of stimulative housing policies to rescue the property market.

"Market equilibrium can be achieved by the end of next year, since the demand will be bolstered on one hand and the supply is limited on the other hand," he said.

He estimated private housing stock available for sale, including finished and unfinished developments, totalled 41,000 units. Average annual new supply from 1999 to next year was about 30,000 units, he said.

Midland Realty executive director Victor Cheung said confidence in the property market had improved since the government had unveiled its new housing policy aimed at limiting future supply.

"The market response at Queen's Terrace is not showing a dramatic change in demand but the sales figure is positive to the market," he said.

Cheung Kong (Holdings) and New World Development have not yet released precise sales figures for Queen's Terrace in Sheung Wan but Mr Cheung said fewer than 100 units in the development, comprising a total of 1,148 units, remained unsold.

He earlier predicted all the units might be sold on the first day of public sale last week. "Buyers are still conservative and calm. Speculation has not yet formed as there are only a few secondary transactions."

He said the private residential market was clouded by the continuous contraction of secondary transactions.

Nelson Wong, Jones Lang LaSalle's head of research for Greater China, said: "There will be an abundant supply of first-hand properties in the near future, which leaves little room to raise prices.

"Developers will devise more attractive packages to attract potential buyers, and competition will be the keenest in West Kowloon, Tseung Kwan O and Tung Chung."

The mass residential market has been on a mild downward trend over the past two years, according to Jones Lang LaSalle. Capital values of mass residential properties have depreciated by about 10 per cent from a year earlier.

Lower prices and competitive mortgage packages meant property was increasingly affordable, the real estate firm said. But economic uncertainty and job insecurity would remain the prime concerns for potential buyers.

Hong Kong developers have raced to apply for pre-sale consents from the Lands Department to cope with increased sales volumes during the past year.

The number of unfinished flats secured by developers for pre-sale rose sharply. In the first 11 months, the Lands Department issued pre-sale consents for 33,838 units in 38 private-sector projects, nearly double the 16,961 units in 32 projects approved for the whole of last year.

This compared with 14,353 units approved in 2000 and 19,635 flats in 1999.

At the end of November, the Lands Department was processing 23 applications for pre-sale consent involving 13,882 residential units throughout the SAR.

Sun Hung Kai Properties (SHKP) has emerged as the top seller so far this year, having secured pre-sale consent for about 4,800 units in its own projects and for about 8,000 units in joint ventures.

Most of those projects have been released for sale.

The biggest success among them was the immediate sell-out of about 2,600 units in Park Island on Ma Wan in August.

SHKP sold 5,700 flats for a total of HK$15 billion in the first 11 months of this year, compared with HK$13 billion from 4,600 units for all of last year.

SHKP chairman Walter Kwok expects to sell 6,200 units next year, involving a total floor area of 4.2 million square feet, for more than HK$15 billion.

Cheung Kong (Holdings) was the No 2 seller, with 1,484 units in its own projects and about 5,000 units in joint ventures granted pre-sale consents. Executive director Justin Chiu Kwok-hung said the company had sold 3,800 apartments this year, generating HK$13 billion.

3. Bridge to Zhuhai will have little impact on river flow, study finds
GARY CHEUNG in Guangzhou, SCMP 17 December 2002

A proposed bridge linking Hong Kong, Zhuhai and Macau will only have a minor effect on the water level of the Pearl River estuary, a study conducted by mainland experts has found.

The study, by the Chinese Academy of Sciences' South China Sea Research Institute, found the bridge would only raise the water level of the delta estuary by between 15 and 20 centimetres.

It concluded that the bridge project was feasible from an environmental perspective and would be unlikely to cause flooding in cities upstream.

The study was commissioned by Qian Zhaojun, a former vice-director of the Guangzhou-based Navigation Design and Survey Institute, a subsidiary of the State Economic and Trade Commission.

Guangdong Governor Lu Ruihua said this month the proposal needed careful study because it involved ecological problems.

It is understood the provincial authorities fear the project might affect the tidal flow in the Pearl River Delta and that cities upstream could face an increased flooding risk if the water flow was blocked.

Chief Executive Tung Chee-hwa last week revealed during a visit to Beijing that the central government was positive to the bridge proposal, while a feasibility study was being carried out by the SAR government.

Professor Qian said the study was conducted by two experts at the South China Sea Research Institute two years ago to assess the possible impact of the proposal to build a bridge linking southwestern Lantau Island, Macau and Zhuhai.

The study was based on an alignment similar to the Hong Kong government's proposal of a Y-shaped bridge, except that the study model's link ran through Guishan Island, which lies south of Lantau, and a 30 sq km artificial island.

"Generally speaking, the rise in water level is not considered serious unless it rises by over 50 centimetres," he said.

Professor Qian said the Hong Kong government's proposal, which did not contain an artificial island, would cause even less impact on water flow in the estuary.

"I expect some upstream counties and cities would seek government grants to build extra dams if the bridge is built," he said.

"But we should take the economic gains brought by the bridge into account when deciding the way forward."

4. Building plans approved in October
Hong Kong Government, 16 December 2002

The Buildings Department approved 26 building plans in October -- four on Hong Kong Island, 11 in Kowloon and 11 in the New Territories.

The approved plans covered eight for apartment and apartment/commercial developments, three for commercial development, four for factory and industrial developments and 11 for community services developments.

In the same month, consent was given for works to start on 14 building projects, which will provide on completion 20,421 square metres of usable domestic floor area and 146,274 square metres of usable non-domestic floor area.

The department also issued 14 occupation permits -- two on Hong Kong Island, two in Kowloon and 10 in the New Territories.

Of the buildings certified for occupation, the usable floor areas for domestic and non-domestic uses were 139,208 square metres and 15,700 square metres respectively.

The declared cost of the new buildings completed in October totalled about $2.455 billion.

In addition, 10 demolition consents involving 10 building structures were issued.

The department received 3,429 complaints against unauthorised building works in October, and issued 4,582 removal orders on unauthorised works.