Hong Kong tests student housing land sales as office market slowdown curbs tenders

Hong Kong is testing purpose-built student housing as an alternative land-sale model, as weak demand for commercial sites pushes the government to explore uses that can still attract investor interest.The Development Bureau on Tuesday invited expressions of interest (EOI) for student hostel development on three commercially zoned sites in Kai Tak, Siu Lek Yuen in Sha Tin, and Tung Chung East, marking the first time the government had proposed selling land through open tender with use restricted exclusively to student accommodation.The move comes after the government effectively halted commercial land sales due to high office vacancy rates and ample existing supply, amid fears the tenders could fail or be withdrawn due to lack of bids.Student housing has emerged as one of the few property segments still drawing capital, driven by rising non-local student numbers and a shortage of professionally managed accommodation in recent years.The three sites, including one in Siu Lek Yuen, Sha Tin, are good for 4,500 beds. Photo: Google Maps“It’s always good to see more supply as the demand is heavy,” said Andrew Chan, chief investment officer at Crystal Investment, Hong Kong’s first institutional student housing operator, noting that investor interest would ultimately depend on pricing.The three sites could deliver about 4,500 beds in total. Under the proposal, the government planned to restrict their use to student hostels and prohibit the sale of individual rooms. Measures were intended to ensure long-term, cohesive operation but also narrowed exit options for developers.