Sino Land and Cheung Kong (Holdings) bid HK$5.18 billion, about 50 per cent more than the opening price, for two residential plots in Kowloon and Sha Tin yesterday.

Sino Land got the Broadcast Drive plot in Kowloon for HK$1.94 billion and Cheung Kong paid HK$3.24 billion for the Ma On Shan plot in Sha Tin at the third land auction of this fiscal year.

The bidding for the Broadcast Drive site was furious, with more than 10 developers, including K. Wah International Holdings, Kerry Properties, New World Development and Henderson Land Development, pusing up its price. Sino Land outbid the others only after 49 increments.

The per square price of the plot came to HK$9,868, 76 per cent higher that the opening price. The market had expected the plot to fetch between HK$1.34 billion and HK$1.8 billion.

Sino Land Executive Director Robert Ng Chee-siong told reporters that he was satisfied with the result. "The price is in line with our expectation... we will develop the site solely for a luxury residential property, with a total investment of about HK$3 billion."

The flats to be completed in a couple of years are expected to fetch more than HK$14,000 per square feet, the rate for the units in the company's project in the adjacent area.

The sentiment for the Ma On Shan plot, however, was relatively tepid. Tycoon Li Ka-shing-run Cheung Kong paid 24 per cent more than its opening price to bag it.

Cheung Kong Executive Director Victor Li Tzar-kuoi said the company will develop the project alone. "We are happy to win the bid. The price is still reasonable for us despite development costs pushing up as high as HK$6,000 per square feet, but it is worthwhile because the site with a river view is even more exotic and rare in the region."

Lands Department Assistant Director Graham Ross said he was pleased with the auction. The price truly reflects the current market condition and developers' enthusiasm.

The property market is moving back on the track to meet the HK$30.5-billion target in the current fiscal year. The government has 40 plots in its land reserve that could be auctioned after a buyer triggers its price.

But major local developers' share pirces dropped after the land auction, in line with a broader market, which plummeted by nearly 3 per cent. That was the largest single-day drop after September 11, 2001.