Among the latest sites set to test the high levels again is a 251,878-square- foot vacant plot at Java Road and Tin Chiu Street, near North Point Ferry Pier, that will open for tender bids between May 25 and July 6. It is one of five Hong Kong Island sites on the government's application list.

The market estimates the site - which has a commercial component as well as a residential one - will fetch HK$8.46 billion to HK$10 billion, or HK$9,391 to HK$11,103 per buildable square foot.

"The project entails huge investment. I think the tenders will just be competition between the several big developers," said Charles Chan Chiu- kwok, managing director of Savills Valuation and Professional Services. Chan valued the site at HK$9.45 billion, with per buildable sq ft cost of about HK$13,000 for the residential component. Therefore, completed flats are likely to sell for more than HK$20,000 psf.

So far in land sale history, four sites have topped the HK$10 billion mark, the most recent being the 112,800-sq- ft plot on Borrett Road, Mid-Levels, that was acquired last June by Cheung Kong (Holdings) (0001) for HK$11.65 billion.

But it did not beat the record high. Back in 1997, a consortium led by Sino Land (0083) snapped up the 275,470-sq-ft site that houses Island Resort in Siu Sai Wan for HK$11.82 billion.

Meanwhile, several major developers have already expressed interest in the latest North Point site, including Sun Hung Kai Properties (0016) and Kerry Properties (0638).

But like other sites the government sold in the past couple of years, it also carries stipulations. Designated for residential and commercial purposes, the site carries a gross floor area of 900,677 sq ft, of which residential must cover between 346,687 sq ft and 577,812 sq ft - providing at least 700 flats.

"Even with the stipulations, average size of the future units would be around 825 square feet. Investment value of the site is high, but I don't think it will affect the land price," said Vincent Cheung Kiu-cho, national director for valuation and advisory services at Cushman & Wakefield, who expects the site to fetch HK$8.46 billion.

Last August, Cheung Kong won the tender for an 84,895-sq-ft North Point property on Oil Street, shelling out HK$6.27 million, or HK$8,294 per buildable sq ft, for the site comprising hotel, commercial and residential components.

"Compared with Oil Street, there is more area earmarked for residential development on this [Java Road] site," Cheung said. "Cash would be easier to generate in this kind of setting, which should be attractive to the developers."

Centaline Surveyors director James Cheung King- tat said the sea view and location should appeal to developers. "Sites of comparable quality in the neighborhood could cost more than HK$10,000 per buildable sq ft. The average asking price of nearby secondary homes has hit HK$12,000 per square foot."

The secondary market has already been affected. Local agents say the owners of about 15 percent of the units listed for sale in the area have either raised their asking prices or pulled the flats off the market.

One owner tacked on HK$400,000, or 4.7 percent, to the asking price of a 896-sq-ft unit at Garden City - boosting it to HK$8.9 million. Another withdrew a high-floor flat in Block 17 of Provident Centre from the market which he had listed for HK$19 million.

Some purchasers are snapping up flats before anticipated price hikes.

A 944-sq-ft flat at Provident Centre was sold for HK$10.38 million, or HK$10,996 psf. Another apartment in Block 3 at City Garden changed hands for HK$8.38 million, or HK$9,490 psf.