New World Causeway Bay Old Building to be Auctioned Tomorrow with a Starting Price Exceeding 2.6 Billion

The New World Development (00017) acquisition of an old building cluster in the Causeway Bay Fossey Street area, which has been in place for nearly 13 years, will hold an auction tomorrow.

First Pacific Davies announced that it will hold a public auction for sale at 10:00 a.m. tomorrow morning on the 5th-floor level of the United Centre in Admiralty. The sale includes three sites: the Happiness Building at Nos. 54 to 60 Fossey Street and Nos. 5 to 11 Jardine’s Hill Road; Nos. 62 to 68A Fossey Street and Nos. 13 to 19 Jardine’s Hill Road; as well as the sites at Nos. 70 to 76 Fossey Street, No. 60 Russell Street and Nos. 21 to 27 Jardine’s Hill Road. The auction reserve price is HK$2.679 billion.

The total site area of the above properties is approximately 19,831 square feet. They are adjacent to major commercial projects in Causeway Bay, such as Hysan Place and Times Square. The properties currently comprise multiple buildings of 6 to 9 storeys built in 1963, with shops on the ground floor and residential use on the upper floors. Each building is equipped with a common staircase.

According to information, the above compulsory auction site is an old-lease project. The land lease offers greater development flexibility, while the outline zoning plan designates the site as a “Commercial (2)” zone, with potential to be redeveloped at a floor area ratio of 15 times. It is estimated that it can be redeveloped into a commercial project with a total gross floor area of about 297,500 square feet.

Chen Chaokuo, Managing Director of Valuation and Professional Advisory Services at First Pacific Davies, said that land in the core area of Causeway Bay has always been scarce in supply. The site being auctioned is located between the two major landmarks, Hysan Place and Times Square, enjoying convenient supporting facilities and the advantages of the core commercial district. This not only has extremely high strategic merger and acquisition value, but can also generate synergy with the developers’ existing projects in the area, unlocking substantial value appreciation potential.