Developer CK Asset has proposed turning an industrial area near Hong Kong’s Sha Tin Racecourse in the New Territories into a residential area that can accommodate 4,700 flats.

The flagship company of tycoon Li Ka-shing submitted an application for the rezoning of the land in the East Fo Tan Industrial Area to the Town Planning Board through a company called Hybonia Limited, according to a statement from the developer’s spokeswoman.

“If the Town Planning Board approves it, CK Asset will become a pioneer and start the first phase of redevelopment work,” the spokeswoman added.

The plan, according to the statement, is to have the site redesignated for residential, government, institution or community use to cope with the increasing demand for housing in Hong Kong. The city is famous for its exorbitant property prices underpinned by a lack of supply.

CK Asset plans to build 24 residential buildings with 28 to 38 floors, including shops and underground parking. The design will allow for about 4,700 residential units with an average area of 56.5 square metres, or 608 square feet, and a school.

The entire site covers an area of 53,163 square metres, or 572,245 sq ft, and the total residential floor area is around 266,000 square metres.

The redevelopment will provide about 3.15 million sq ft of residential and retail space, according to a Knight Frank estimate.

Upon completion, the total market value would be about HK$46 billion (US$5.9 billion), said Natalie Wong, senior director of valuation and advisory at Knight Frank.

The land alone is worth about HK$30 billion, according to James Cheung, executive director of Centaline Surveyors.

The project is in a “very good location” with “good prospects”, said Leo Cheung, adjunct associate professor at the University of Hong Kong. He estimated homes there now sell for around HK$21,000 per sq ft while non-residential properties change hands for about HK$25,000 per sq ft.

The district will become a “garden city” with about 40,000 sq m of greenery and leisure space, the statement said.

The plan includes the construction of a footbridge spanning the entire residential development area and a connection to the adjacent Fo Tan MTR station to facilitate residents’ access. At the same time, a primary school with 24 classrooms will be built to meet the future educational needs of the area.

The rezoning plan will phase out the existing East Fo Tan Industrial Area through the redevelopment or conversion of existing buildings.

Given the long development time span, the homes in the new development could achieve prices of HK$28,000 to HK$30,000 per sq ft, said Michael Lee, associate director of professional real estate advisory and valuation at Prudential Surveyors (HK).

The proposal could create a win-win situation for the government and the developer as the authorities is also trying to convert industrial land in Hong Kong to residential use, said Alex Leung, senior director at CHFT Advisory and Appraisal.

The Planning Department submitted applications to the Town Planning Board this week to convert two other industrial areas in Sha Tin’s Siu Lek Yuen and Sheung Shui as residential and business areas.