Hong Kong has already beaten its private housing land supply target for the financial year with a quarter to spare, and the government plans to keep selling anyway. The Development Bureau said land made available from April through December 2026 should support about 15,680 private homes, against a full-year target of 12,600, and that it will tender a residential site in Shek Mun, Sha Tin, able to hold around 960 flats before the end of December.

For developers and their shareholders, the signal is that the government sees enough demand to keep feeding the market rather than holding sites back to protect prices. It also puts the pace of new supply, not just interest rates, back into the outlook for listed builders.

Hong Kong land sale programme: one government site, three other channels

The October-to-December programme, announced on Oct. 15, includes only one government residential site. Secretary for Development Bernadette Linn said the Shek Mun plot, at the junction of Tai Chung Kiu Road and On Sum Street, offers about 48,090 square meters of floor space. It was first zoned for commercial use and has since won Town Planning Board approval for housing. The buyer must also build a public car park on the site, with that floor space exempt from gross floor area limits under a policy introduced last year.

The rest of the quarter's supply comes from elsewhere. The Urban Renewal Authority's To Kwa Wan Road project should yield about 1,050 flats, and seven private development and redevelopment projects are expected to complete lease modifications or land exchanges, adding about 1,835 flats. In total, the bureau puts the quarter's private housing land supply at about 3,845 units.

The bureau also plans to tender a commercial site at Siu Lek Yuen in Sha Tin for student hostels, with about 600 beds, near City One and Shek Mun MTR stations. It said it will decide what to do with two similar sites in Kai Tak and Tung Chung East after seeing how that tender goes.

Linn gave three reasons for selling past the target. The annual figure is not a rigid indicator, she said. Projects led by the government, including the Northern Metropolis, railway property development and urban renewal, run on their own timetables. And with what she called "generally positive market sentiment," she said developers have the demand and capacity to take on mature urban land.

The target was close to being met by midyear. When the bureau announced its July-to-September programme on July 10, it estimated first-half supply at about 12,430 units, lifted by MTR Corp.'s Tuen Mun A16 Station (Package 2) project of about 5,510 flats and three residential sites in the Northern Metropolis. It also said actual supply for 2025-26 had been revised up to about 16,865 flats, roughly 28% above that year's target.

Developers bid in force for Ho Man Tin

Recent tenders back up Linn's reading of demand. On Oct. 6, the Lands Department awarded a residential site at Fat Kwong Street in Ho Man Tin to Asia Insight Investments, a unit of Kerry Properties, for HK$4.31 billion on a 50-year grant. Nine other bidders took part, including units of Sun Hung Kai Properties, CK Asset, Hang Lung Properties, China Overseas Land & Investment, Wheelock Properties and a Sino Land and Great Eagle joint venture.

The site has a maximum gross floor area of 19,300 square meters, which works out to about HK$20,700 per square foot of buildable space, by Capital Times' calculation. The government had said in July the plot could provide about 250 flats. The bidding came as home prices edged higher and rents set new records, as Capital Times reported on September price data.

Land premium from other routes is smaller but steady. The Lands Department said on Oct. 15 that lease modifications, land exchanges, private treaty grants and a lot extension registered in the July-to-September quarter brought in about HK$2.93 billion. The private treaty grants included one to Hung Shui Kiu Industry Park Company, which is wholly owned by the government, and one to MTR Corp. for housing in Yuen Long.

Northern Metropolis land shifts to large consortium tenders

In the Northern Metropolis, the government is testing a different model: large parcels that bundle housing with industry. The first tender under the large-scale land disposal pilot, in the Hung Shui Kiu/Ha Tsuen New Development Area, closed in July with two bids, from Henderson Land and a consortium called HSK New Development, according to The Standard. Bids were scored 70% on the industry development proposal and 30% on the land premium.

The Development Bureau awarded that tender on Aug. 24 to HSK New Development for HK$1.03 billion, RTHK reported. The consortium's six shareholders are China Overseas Land & Investment, China Merchants Land, China Resources Land, China Travel Service, JD.com and a Sino Land subsidiary. It will develop three residential sites with about 3,000 flats, plus an enterprise and technology park, with JD.com as anchor tenant. The group put total investment at about HK$16.8 billion and chose to pay the full premium within 28 days rather than in installments.

The next date on the calendar is Nov. 9, when a separate Lands Department tender closes for short-term tenancies on three government sites in Kwun Tong, Tuen Mun and Yuen Long, reserved for brownfield operators displaced by government development projects. For Shek Mun, the bureau said the tender timetable depends on preparatory work, and the Lands Department will announce sale details before the site goes to tender.