Land deals in the January-to-March period almost doubled from a year earlier to NT$61.3 billion (US$1.99 billion) as local developers built land stock encouraged by the housing market’s slow but steady recovery, analysts said.
The volume was the second-highest since June 2012, when the government started to introduce a spate of unfavorable measures to cool the property market, property consultancy Cushman & Wakefield Taiwan said.
Land deals rose to a record NT$67 billion in the third quarter of 2010 as developers grabbed plots in Sinjhuang District (新莊) in what was then Taipei County amid government efforts to invigorate the area, the international broker said, adding that confidence after the global financial crisis in 2008 and 2009 also supported the activity.
Residential and commercial plots accounted for 66 percent of the deals, while industrial lots drove the remaining 34 percent, Cushman & Wakefield Taiwan general manager Billy Yen (顏炳立) said.
All of the industrial plots were in New Taipei City and were acquired by developers, rather than by manufacturers, to expand capacity as seen in recent years, Yen said.
The trend reflected property fund flows to New Taipei City from Taipei, where existing office space is aging and scarce due to a lack of land, Yen said, adding that old buildings are being converted into non-office facilities after lengthy urban renewal processes.
This has prompted developers to acquire plots of land along the MRT Bannan Line, which goes from Banciao District (板橋) in New Taipei City to Nangang District (南港) in Taipei, as they are upbeat about its growth potential, he said.
New clusters of office buildings would emerge in New Taipei City in the next 10 years, which might generate stale rental income, Yen said.
Savills Taiwan Ltd (第一太平戴維斯), another international broker, said that construction firms have regained confidence.
That explained why the auction for plots of land in New Taipei City’s Tucheng District (土城) attracted 16 bids, with Maw Der Property Development Co (茂德機構) winning the auction with a 49 percent premium, Savills Taiwan said.
The plots of land were owned by troubled home appliance group Tatung Co (大同), which was selling assets to ease its financial woes.
The National Property Administration also auctioned plots of land in Taichung for a combined NT$4.5 billion, government data showed.
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