The government has no intension of buying back The Link Reit because that would not help lower the rents of shopping centres and car parks, a top official said on Wednesday.
Secretary for Transport and Housing Anthony Cheung Bing-leung dismissed calls to buy back a controlling stake in the Link, a real estate investment trust that manages about 180 shopping centres and car parks formerly run by the government.
The Link has been managing the city’s largest retail portfolio since the Housing Authority privatised its shopping centres and car parks in 2005.
It faces frequent criticism for forcing out small-scale retail tenants by increasing their rents.
Even with its controlling power, the government could not cut rents significantly because the trust’s conditions require it to maximise profits for investors, Cheung said.
The housing secretary was responding to a motion raised by League of Social Democrats’ lawmaker “Long Hair” Leung Kwok-hung at a Legislative Council meeting on Wednesday afternoon.
Leung called for the government to buy back at least 25 per cent of the Link’s shares to curb exorbitant rents and prices.
The Labour Party’s Lee Cheuk-yan supported Leung’s motion, saying the Link had replaced small vendors with large chains, limiting the shopping choices of public housing tenants.
However, New People’s Party Michael Tien Puk-sun disagreed, saying the government should uphold free-market economy principles. It would face legal challenges by shareholders if it cut rents considerably, he warned.
In June, chief-executive-elect Leung Chun-ying said buying back shares in the reit could be an option to lower the rents of local businesses.