Thursday, June 17, 2010

Record $79m sale of HK flat scrapped

HONG KONG: Hong Kong officials said yesterday they will look into the controversial sale of a luxury flat that fell through months after its developer said it had snatched a world-record price.

Property giant Henderson Land Development revealed on Tuesday that the sale of 20 luxury apartments collapsed, ending HK$2.67 billion (S$480 million) in deals that sparked a government inquiry and fuelled efforts to rein in home prices.

The scrapped deals included what was supposed to be the world's most expensive apartment, a 6,158 sq ft duplex that Henderson said last October was sold for US$56.6 million (S$79 million), or a record price of HK$88,000 per sq ft.

Most buyers pulled out of the 39 Conduit Road project in Hong Kong's Mid-Levels district, Henderson said in a filing to the stock exchange yesterday, responding to government demands for more information on the sales of 24 units.

Henderson said it has sold four of the units and will record a charge of HK$734 million in its half-year results.

Critics demanded a probe into the collapse and asked why the cancellations came to light only eight months after the announcement of the sales, which helped hike prices of the city's luxury residential flats and stoked concerns about a property bubble.

A government spokesman said yesterday it would look into the matter 'to consider the next step'.

Billionaire tycoon Lee Shau Kee, chairman of Henderson and Hong Kong's second-richest man, told reporters he was not bothered by the scrapped deals. 'I may be able to sell them for more,' the South China Morning Post quoted him as saying.

The cancellations are 'quite a negative surprise', said Mr Raymond Ngai, a Hong Kong-based analyst at JPMorgan Chase.

'Those record prices they reported earlier, I doubt they will be able to sell them at those prices again,' he said.

Henderson has also been condemned for being unscrupulous and misleading by selectively numbering the floors on the 46-storey building as a ploy to attract Chinese buyers.

The supposed 68th-floor duplex that snatched the world-record price was actually on the 43rd and 44th floors, according to reports. But it was so numbered because '68' sounds like 'continuing fortune' in Chinese and is considered lucky.


Source: Straits Times, 17 Jun 2010

No comments:

Post a Comment