The development secretary says a developer may 'learn a lesson' from the latest residential project it delivered with the Urban Renewal Authority, which has been criticised for its tiny flats and sky-high prices.
Carrie Lam Cheng Yuet-ngor was commenting on the Queen's Cube project in Wan Chai, the URA development with Nan Fung Group which is currently on sale.
Yesterday, lawmaker Lee Wing-tat of the Democratic Party attacked the project at a meeting of the legislature's development affairs panel.
Lee said a 400 sq ft flat with an asking price of almost HK$6 million and a saleable area of only 275 sq ft including balcony was outrageously overpriced. The project raised eyebrows when flats went on the market at HK$14,888 per sq ft of gross floor area this month. Only two of the 96 flats were sold at the launch - one of the worst responses in recent years.
Lam said: 'True, there is a perception issue with the project. But in a joint venture between the URA and a developer, they play by the market rules. The URA cannot breach the rules and the contract [with the developer] because of perceptions.'
She was referring to public criticism and calls for the URA to lower the prices. 'The developer took a risk with such aggressive pricing, but it has also learnt a lesson,' she said. At the meeting, Lam also said she could not give a response to some lawmakers' demands that the government and the MTR Corporation force MTR residential projects to follow new, stricter rules on 'inflated buildings', which take effect in April. Inflated buildings are those in which developers have used concessions to inflate the gross floor area without adding to the usable area.