The nation’s land market remains strong and could see record trading this quarter if an auction for superfices rights to regenerate the Taipei World Trade Center’s Exhibition Hall 3 secures a buyer next week, analysts said.
The Ministry of Finance is to go ahead with the auction on Monday for a 70-year superfices rights lease to redevelop the 17-year-old hall next to Taipei 101 in the city’s Xinyi District (信義).
The ministry has set a floor price of NT$26.64 billion (US$878.74 million) for the 4,856 ping (16,053m2) plot, which can be developed into a mixed-use complex featuring upscale office space.
The auction could raise land transactions above NT$70 billion this quarter after major deals have so far totaled NT$47.8 billion, international property consultancy Savills Taiwan Ltd (第一太平戴維斯) research manager Erin Ting (丁玟甄) said.
Domestic life insurers would be among prospective buyers given their deeper pockets, Ting said.
Regular rental income that would be created by the project would also attract bidders, she said, adding that monthly rent for new grade-A office space would be NT$4,000 per ping.
“The amount would be acceptable in light of low vacancy rates and a lack of new supply on the horizon,” Ting said.
The auction is drawing attention, as it comes at a time when the COVID-19 outbreak in Taiwan and abroad is dampening confidence in all business sectors.
Knight Frank Taiwan researcher Andy Huang (黃舒衛) said that domestic insurers are unlikely to sit out auctions for investment targets in Taipei’s central business districts.
Superfices rights auctions for properties in popular locations have over the past few years witnessed intense competition, as they proved profitable investments thanks to robust demand for Grade-A offices, Huang said.
However, similar investment opportunities in Kaohsiung failed to attract any bidders last month, driving Taichung authorities to put off auctions for plots of land intended for a financial complex in central Taiwan.
Huang said that the size of the vast plots in Taichung and Kaohsiung raised uncertainty about their profitability outlook, which he said is not the case in Xinyi District.
The exhibition hall is close to MRT stations, department stores, restaurants, and the headquarters of Taiwan’s top financial and technology companies.
Nevertheless, the high asking price would limit the number of participants and the outbreak could dim the chance of generous premiums, Huang said.
NOT ALL GOOD: Analysts warned that other data for last month might be less rosy due to the virus and analysts expect the PMI to contract again next month Chinese factory activity saw surprise growth last month as businesses went back to work following a lengthy shutdown, but analysts said that the economy faces a challenging recovery as external demand has been devastated by the COVID-19 pandemic, while the World Bank said that growth could screech to a halt. China is slowly returning to life after months of tough restrictions aimed at containing the virus, which put millions of people into virtual house arrest and brought economic activity to a near standstill. The strict measures saw a closely watched gauge of manufacturing plunge to its lowest level on record in February,
The output of the global smartphone industry this year is to contract by 7.8 percent on an annual basis as the COVID-19 pandemic ushers in a global recession, Taipei-based market researcher TrendForce Corp (集邦科技) said in a report on Monday. The global production of smartphones is expected to fall to 1.29 billion units, as the pandemic dampens demand for consumer electronics, leading to a decline in shipments across Europe and North America, TrendForce said. With consumers delaying smartphone purchases and thereby lengthening the device replacement cycle, overall prices would suffer a setback that is expected to negatively affect the profitability of smartphone
ELECTRONICS Lite-On delays sale of unit Lite-On Technology Corp (光寶科技) yesterday said it would postpone the sale of its solid-state drives (SSD) business to Kioxia Holdings Corp, formerly known as Toshiba Memory Holdings Corp, due to disruptions amid the COVID-19 pandemic. Last year, the Taiwan-based electronics components supplier struck the deal with the Japanese firm, agreeing to sell the unit for US$165 million. Citing unfinished integration work due to the pandemic, Lite-On has deferred today’s closing date until further notice, adding that the delay would not have a negative effect on the unit’s operations. AUTO PARTS Hiroca approves dividend Automotive interior parts supplier Hiroca
DEVELOPING TALENT: The electronics contractor is looking to recruit people to work in core tech fields and emerging industries like electric cars and robotics Hon Hai Precision Industry Co (鴻海精密), the world’s largest contract electronics maker, has launched a recruitment drive, offering a monthly salary of no less than NT$45,000 (US$1,485) to university graduates. For those with a master’s degree, the starting pay would be NT$52,000 per month at the minimum, while doctorate degree holders would receive at least NT$60,000 a month, Hon Hai said a statement issued early this week. The latest recruitment drive is aimed at attracting talent in core technology fields — artificial intelligence, semiconductors and next-generation mobile communications — and emerging industries — electric vehicles, digital healthcare and robotics, the