A prime parcel in Hong Kong owned by the U.S. State Department could sell at a much lower price point than asking prices in the neighborhood just a couple years ago.
Luxury residential pricing in Hong Kong has fallen over the last year or so because of last year’s civic unrest in the territory and the coronavirus pandemic.
Experts expect bids for the 95,000-square-foot State Department property at 37 Shouson Hill Road to be as low as $400 million, about 24 percent lower than the price developer China Resources Land paid per square foot for a comparable neighboring property in 2018.
The State Department is selling the property as part of a global reinvestment push, according to a State Department spokesperson. The U.S. houses consulate staff in the apartment complex on the property. CBRE is marketing the property.
The coronavirus pandemic has brought the Hong Kong market to a near standstill compared to past years. Luxury rents fell 10 percent year-over-year in the first quarter and transaction volume fell 44 percent in that period.
London-based brokerage Savills pins that mostly on decreased demand from mainland China. Residential investment and leasing deals from mainland Chinese buyers and renters fell 80 percent year-over-year in the first quarter of 2020.