Auction result baffles analysts.

(From South China Morning Post)

Byline: Peggy Sito

Observers have been trying to explain the unexpected outcome of last Tuesday's government land auction, at which Cheung Kong (Holdings) and KWah International bid much higher than predicted for two residential sites.

While sceptics believe the developers' aggressive bidding was aimed at rejuvenating the slowing housing sector, some market watchers suggest they have made a mistake - again.

Last week's auction evoked memories of leading developers being forced to make huge provisions for their projects after aggressively buying sites at the market's peak in 1997.

At the time, …