Police part of probe into Henderson's cancelled luxury apartment sales

PUBLISHED : Sunday, 27 June, 2010, 12:00am
UPDATED : Sunday, 27 June, 2010, 12:00am

Police are involved in the investigation into cancelled sales of flats at a luxury Mid-Levels project that the developer said had fetched prices of up to a world-record HK$88,000 a square foot.

The police involvement in the probe into the Henderson Land Development transactions was revealed in a Transport and Housing Bureau document, which stated it would not comment on the case as it was being investigated by police and other agencies. The law-enforcement and regulatory agencies are looking into 20 cancelled transactions at 39 Conduit Road, after developer Henderson trumpeted the sale of 24 flats at the luxury Mid-Levels block last October.

The bureau also said it would not make public correspondence between the Lands Department and Henderson.

The document emerged after Democratic Party lawmaker Lee Wing-tat asked the department to publicise its communication with Henderson, and called for the case to be discussed in the Legislative Council. The police declined to comment yesterday. A Henderson spokeswoman said: 'We are open to investigation. If they contact us, we'd be happy to provide them with the necessary information.'

Civic Party lawmaker Ronny Tong Ka-wah said he could not think of any reason to launch civil or criminal litigation against Henderson, since there is no law governing how property prices are set. He said the police would look into the possibility of fraud, but finding victims would be difficult since the buyers could be speculators who decided to pull out of the sales fearing they could not make a profit.

Critics have been calling for government action, saying Henderson's trumpeting of the sales - including a HK$439 million sale of a top-floor duplex - artificially inflated prices in both the luxury and mass markets.

'Any fraud or deception in property sales is totally unacceptable,' the government said last week. 'As only four out of the 24 transactions of 39 Conduit Road were completed, relevant regulatory and law enforcement agencies are looking into and following up on the case.'

Henderson said two weeks ago the deals at the luxury block had fallen through, including the world-record HK$439 million top-floor duplex. It made a loss of HK$734 million on the unsold flats, which will be written off in the next financial statement. The firm has until Tuesday to give information to the department on the cancelled sales.