Developers are expected to become more aggressive in venturing into serviced-apartment projects in anticipation of proposed regulatory changes which will ease controls on sales and management of the sector.
The relaxation proposed by the Lands Department involves changes in lease conditions effectively allowing the strata-title sale of serviced apartments.
Despite a couple of exceptions, serviced apartments cannot be disposed of except as a whole under existing rules.
To simplify and streamline procedures and practice, the Lands Department suggested dropping serviced apartments as a special category in land lease conditions and replacing it with a broader residential use.
It is believed the department is concerned about the potential problem of differentiating between serviced apartments and highly serviced residential flats. Industry experts said categorising land use as simply residential would avert uncertainties over future sales and management of such properties.
Developers would be delighted by the relaxation of rules as the ability to sell serviced apartments on strata-title would make it easier for developers to cash in as they do in conventional residential projects, analysts said.