News analysis : Mount Arcadia is on sale
- Five apartments at Mount Arcadia sold through tender
- Additional batch of units offered for tender
- This completed residential development should be lucrative given low land costs
Far East Consortium has sold five apartments at Mount Arcadia in Tai Wai via tender for HK$82m or HK$16,000psf on average. Buyers are local upgraders. Given satisfactory market response, the company is offering an additional eight apartments for tender.
Mount Arcadia is located on Tai Po Road. This newly completed residential development contains 62 apartments and 4 houses with total saleable area of c.84,000sf. The company acquired the site where Mount Arcadia is built through government tender for HK$245m in Mar-16. Including construction and financing costs, we estimate all-in development costs at HK$9500psf. We forecast that Mount Arcadia, if fully sold, should yield pre-tax earnings of >HK$500m.
We have a BUY call with HK$3.86 TP.