Surprise at site's low price

PUBLISHED : Saturday, 14 March, 1998, 12:00am
UPDATED : Saturday, 14 March, 1998, 12:00am

The spending watchdog expressed concern yesterday at the low price paid by Li Ka-shing's Cheung Kong (Holdings) for a hotel site in Ma On Shan.

Director of Audit Dominic Chan Yin-tat said he was astonished by the price of the 86,112 square-foot site, which sold through tender for $120 million.

'When I read the newspaper, I was shocked,' he said.

'The price was so low it became a hot topic among my friends who work in property.' He said he would look into the matter to see whether the tender procedure was fair and whether the land price was comparable to similar sites.

The Audit Commission would have to collect more evidence, such as whether the Government could recover site preparation costs from the sale of the land, before a conclusion could be made, he said.

Cheung Kong was involved in another row in November when the Kowloon-Canton Railway Corporation awarded a $10 billion-plus contract for a property development project at the Hunghom station without tender.

Ousted Democrat legislator Albert Chan Wai-yip said the Government had the right to withdraw the site if it considered the tender price was unreasonable.

'It seems that the price does not correspond to the cost-effective use of the land,' he said.

'The Government should have a comprehensive review on the effective use of land.'



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