Henderson reply on luxury deals fails to satisfy

PUBLISHED : Friday, 26 March, 2010, 12:00am
UPDATED : Monday, 03 October, 2016, 5:52pm

The government is not satisfied with Henderson Land's explanation of why the sales of 24 flats in a luxury Mid-Levels development have not been completed five months after the developer said they were sold.

The Lands Department said it would require Henderson to provide more information about the transactions at 39 Conduit Road as the developer was not sure whether they would ever be completed.

The original request came amid calls by legislators for more transparency regarding flat sales to allay suspicions that developers were embellishing them to push up prices.

Henderson said in October the 24 flats had been sold for a total of HK$3.18 billion.

A five-bedroom duplex in the block was sold for a record HK$439 million, or HK$88,000 per square foot.

In a reply received by the department on Wednesday, the developer said it had entered into a verbal agreement with the 24 buyers to extend the transaction date for two to four months, adding that completion might be further extended.

'Given that the developer had entered into new agreements with the purchasers verbally and could not be definite about whether the transactions could eventually be completed, the Lands Department issued another letter to the developer ... requesting further information,' the department said.

Henderson must reply in seven days. The department said it would watch for any anomalies. But neither the department nor Henderson disclosed the further information sought by the government.

A person familiar with the administration's position said the department raised five questions with Henderson: the amounts so far paid by buyers and when they were paid; the dates of the verbal agreements for extending the date of completion; the details of such verbal agreements, including any changes to the purchase price and other changes to the sale and purchase agreements; the length of the extension of time for the 24 transactions; and the expected completion dates of the transactions.

'It sounds rather odd that Henderson Land did not forfeit the deposit paid by the purchasers for failing to complete the transactions as originally scheduled,' an official said.

'Besides, the agreements for extending the completion dates were made verbally and the developer told us it may extend the completion dates again.' The official said the government would continue to monitor the transactions closely.

A spokeswoman for Henderson said the delay in the transactions was understandable as the company should respect customers' needs. 'Flexibility should be given to buyers whenever necessary,' she said, adding more information would be given to the department next week.

The numbering of the block's floors also led to controversy after Henderson skipped 48 floor numbers so that it could market the top two floors as the 68th and 88th floors.