Article from Northcroft Hong Kong office
According to Global Property Guide, Hong Kong is the world’s most expensive city to live in. On average, it costs US$ 28,570 per m2 to purchase an apartment on Hong Kong Island with a rental value of US$ 7,267 per month.
Compare this with property costs in New York where the per m2 price of an apartment is US $17,191 achieving a monthly rent of US$4,942. Or Sydney where the average m2 purchase price of an apartment is US$8,783 with rentals of US$2,505 per month.
Having recognised the housing affordability crisis, the Hong Kong Government has embarked on an ambitious project to provide transitional housing for over 6000 families over the next few years.
One of the transitional housing developments is known as the “Concentric Village”, which will provide 1,800 transitional housing units on a 300,000 square foot site at Shan Pui Road in Tung Tau, Yuen Long. The development will be served by minibus terminals and is conveniently located near the Yuen Long Station and Long Ping Station.
The Concentric Village project has significant importance to Hong Kong and, as a result, has a very high profile. While funded by the Government, Hong Kong Sheng Kung Hui Welfare Council Limited is responsible for planning and managing the project.
“Speed and thoroughness are essential to this project”
In November 2020, Northcroft was invited to assist Hong Kong Sheng Kung Hui Welfare Council Limited to prepare the tender documentation. The tender launch date was January 2021. According to Mr Kent Kam, a director at Northcroft,
“Preparing the tender documents for a project of this scale and importance was challenging given the 2 month timeframe. Even so, while the timeframe was short, there were no compromises when it came to the details and focus we have given the tender documentation process. We are very honoured to be part of the Concentric Village project.”
Amazingly construction of the project began in May 2021.
For the project management team of Concentric Village, remaining on time and within budget are critical elements of project delivery. With Northcroft’s cost management and value engineering services, the project cost was 15% below budget when the Main Contract was awarded.
According to Mr Kam, from the moment Northcroft was engaged by Hong Kong Sheng Kung Hui Welfare Council Limited, “I was confident this project could be completed within budget. With 37 years’ experience in this industry, I know what to expect.”
Despite of the unprecedented short project procurement time, construction of the project began in May 2021 and is on track to be completed in 2022 as planned.
Northcroft is also assisting Hong Kong Sheng Kung Hui Welfare Council Limited to ensure all procedures follow government standards.
Eliminating risk and maximising value
Effective cost management is critical for every project. Even slight misjudgements or ‘unwelcomed surprises’ can erode margins and compromise a project’s financial viability. In the case of the Concentric Village, Northcroft’s experience and quantity surveying expertise are guiding all stakeholders to ensure the project’s success.
Are you planning a new project? Get in touch with Northcroft.