Poll finds wide belief that Conduit Road sales were developer's ploy

PUBLISHED : Monday, 12 July, 2010, 12:00am
UPDATED : Monday, 12 July, 2010, 12:00am

More than 85 per cent of Hong Kong's middle-income group believe the sales of luxury flats at 39 Conduit Road were an act of market manipulation despite the developer's attempt to kill the rumour by running advertisements in newspapers last week, a survey has found.

Among the 526 professionals polled by the Middle Class Alliance between Monday and Friday last week, 452, or 85.9 per cent said the sale of 24 flats at the luxurious complex, among which 20 of the deals eventually fell through - including a top-floor duplex that cost a world-record HK$439 million - was only a tactic by Henderson Land to boost property prices.

There have been calls for an investigation into the sales, including what lawmakers see as an unusual situation in which the developer kept only 5 per cent of the purchase price from each uncompleted sale instead of the whole deposit. Prominent lawyers also say this is unusual.

Four out of five of those polled said the present price of property was not affordable even for the so-called middle class.

The legislature's housing panel will resume discussions on the issue today. But as Henderson Land has refused to send a delegate to attend the meeting, some lawmakers have threatened to invoke their powers to compel a delegate to attend.

The company asked for patience, however, saying they should wait until the government releases the findings of its own investigation.

In a letter addressed to Legco president Tsang Yok-sing on Friday, the developer explained it would not send anyone to attend the meeting.

'The Lands Department has been inquiring into the 'Conduit Road No 39 incident' for nearly four months. Whether our company has been wrong or negligent, it is not difficult to come to a preliminary answer. We hope legislators will give the relevant department more time to finish the investigation,' it said.

In a renewed attempt to allay speculation, the developer ran another advertisement in the South China Morning Post today, stressing that the group has no business transactions, financing or partnership arrangements with the buyers who cancelled their agreements to buy the 20 flats.

In explaining why it did not claim the full deposit payment from the buyers, Henderson Land said it was a commercially sensible decision, as a legal battle could be long and costly while the 20 flats would be immediately available for sale again if there was no litigation encumbering them.

It also said that buying apartments via HK$1 shell companies was common practice.

Negative opinions

The proportion of people polled who thought the flat sales were simply market manipulation: 85.9%