Why Lantau and Discovery Bay are growing in popularity among discerning home investors
- Studded with pristine beaches and country parks, and offering water sports, easy airport access and high-grade transport infrastructure, areas like Lantau and Discovery Bay are getting plenty of attention from developers and homebuyers
Anyone waiting for the right moment to invest in upscale property in Lantau, or one of Hong Kong’s other outlying islands, may well find the next few months is the time to make a move.
That is because of a couple of factors, both a direct result of the coronavirus pandemic. One, of course, is the prevailing uncertainty about immediate market prospects which, for the time being at least, has put the brakes on otherwise escalating prices.
The other is the strong likelihood of a notable number of high-quality homes becoming available within a relatively short time frame. Some are in new developments. The rest, freed up as a consequence of recent turmoil in the airline industry, are expected to be in prestigious blocks in and around Tung Chung, as well as in the enclaves of well-appointed “village houses” that are found mainly across South Lantau.
As things stand, though, there should be no shortage of potential buyers. Despite the stresses and setbacks of 2020, there is as ever an underlying sense of confidence among purchasers that property values will continue to climb over the long term – because that is what they do.
And the wide array of advantages which Lantau now offers, from pristine beaches, water sports and country parks to easy airport access and high-grade transport infrastructure, point to increasing interest from both local and international investors.
“We believe that the market will bottom out by the middle of next year,” says Hannah Jeong, head of valuation and advisory services at Colliers International. “Before then, there may still be more downward adjustments due to overall economic performance and the increasing unemployment rate. But, in general, the residential sector is holding up well and, though prices have been affected, any discounts [will be limited] because of the scarcity of premium assets.”
On that point, Sammy Po, CEO of the residential division of Midland Realty, is in broad agreement. He mentions, too, that control and adjustment measures put in place by mainland cities in recent years to curb speculation have had a perhaps predictable knock-on effect.
“This largely benefits the property market in Hong Kong as capital is prompted to flow, especially to high-end residences here,” says Po, adding that larger properties with an ocean view remain among the top attractions for this segment of the market.
More generally, he notes that, aside from price, buyers are attracted to areas like Discovery Bay by three things in particular: the low-density nature of the development, the comprehensive facilities, and the obvious scope for a rise in value.
“Around 1,000 new units are expected to be rolled out there phase-by-phase in the coming 10 years,” Po says. “The potential for appreciation for these luxury residences should be considerable.”
Indeed, already attracting significant interest, one leading project, Il Picco, offers a rare selection of 21 two-storey detached houses with a saleable area of 2,023 or 2,171 square feet. The development, with an expected completion date of April 2022, is located on a hillside towards the rear of Discovery Bay – if taking bearings from the ferry pier – which guarantees green surroundings and great sea views.
The golf club and a tranquil reservoir are nearby, both contributing to a resort-like ambience and a relaxing environment for future residents.
“Each house features an extensive private garden, ranging in size from 1,963 to 4,124 sq ft, and a private rooftop,” says Pandora Chan, assistant general manager for sales and marketing with main developer Hong Kong Resort Company Limited (HKR). “A number of units will also have their own swimming pools and, overall, our aim is to create a healthy, stylish and distinctive living experience.”
Chan, though, is also quick to emphasise the relative proximity to Central, The ferry ride takes just 25 minutes, and shuttle bus services to the Sunny Bay and Tung Chung MTR stations provide similarly rapid connections to the airport and other parts of Hong Kong.
“Early in the planning and development stage of every project, we embed a philosophy with the focus on quality and sustainability,” Chan says. “We also ensure a diversity of leisure facilities.”
Presently, at Discovery Bay, those include two well-equipped clubhouses, tennis courts, a yacht club, the 400-metre-long Tai Pak beach, and a central park. A new extension to the main plaza will be home to Hong Kong’s largest ice-skating rink, which meets international standards for ice hockey games, along with a host of alfresco options for dining out.
“We will closely monitor market trends and make adjustments in upcoming developments to meet buyers’ needs,” says Chan. “Last year, Poggibonsi, a luxury residential project with 196 units, was launched for sale, and further projects are currently under negotiation with the government.”
Even so, she expects general demand for high-end homes to outpace supply.
“The luxury market will remain stable and resilient,” says Chan. “Sino-US tensions have continued to draw liquidity to Hong Kong and, as Covid-19 eases, we think potential buyers are going to recognise the new market dynamics and will drop their wait-and-see attitudes.”
Elsewhere, most notably in and around the Cheung Sha area of South Lantau, attention is centred on sites that could be made available through government tender for development as villas.
Recent templates are Whitesands, a Swire Properties project, and Sino Land’s Botanica Bay, both of which achieved record-setting sales for the neighbourhood when they were launched back in 2015.
The former offered 28 three- or four-bedroom detached homes, with saleable areas ranging from 1,954 to 2,598 sq ft. Every residence also has its own front and back gardens plus a private roof terrace and parking for two cars.
For many, the pull of such homes, besides their space and amenities, is a location which allows residents to feel close to nature and enjoy “country living”, without being cut off from the buzz of city.
But, of course, maintaining that balance will get ever harder as pressure mounts to convert more plots into exclusive villas able to command top dollar and find favour with residents who require the best in comforts and convenience as part of the package.
Clearly, too, as policy priorities shift and economic activity in Hong Kong tilts more towards links with partners in the Greater Bay Area, the popular image – and persistent sales pitch – of Lantau properties as a rural retreat or seaside hideaway seems destined to fade.
Though still some way off, proposals associated with the ambitious and controversial Lantau Tomorrow Vision put forward by the government leave little room for doubt on that score.
In essence, the plan is to create a new metropolitan centre on 1,700 hectares of reclaimed artificial islands in the waters off northeast Lantau. At an initial estimated cost of at least HK$624 billion, (US$80bn), for just the first phases of reclamation and essential services, it would be Hong Kong’s most expensive infrastructure project ever.
The vision is to create the city’s third economic hub, taking advantage of improved transport links with the Greater Bay Area, while also providing an initial target of up to 260,000 new flats to meet actual and anticipated demand.
If financing can be found and everything gets the green light, preliminary reclamation work is expected to begin in 2025, with the first residents moving in by 2032.
Should that happen, Lantau homeowners can hope to benefit from a spike in property prices, but will also have to deal with a much diminished sense of seclusion.
