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The site was expected to provide 150 flats. Photo: Edward Wong

URA's plan to revitalise old flats in To Kwa Wan falls through

Authority fails to win sufficient support from the owners to redevelop ageing buildings

A demand-led redevelopment project in To Kwa Wan fell apart yesterday after the Urban Renewal Authority failed to gain the support of 80 per cent of the land lease holders.

An authority spokesman said some owners of the 13,175 sq ft site had asked to be paid HK$12,000 per square foot - about 20 per cent more than the authority's offer of HK$10,078.

By the 5pm deadline yesterday, the holders of only 68 per cent of the "undivided shares" in the land - which are allotted to owners according to the size of their flat - had accepted the offer.

This is the second demand-led project to fall through. The first, smaller project on Wong Chuk Street, Sham Shui Po, failed in November after holders of only 78 per cent of undivided shares supported the redevelopment.

It comes as the authority reviews its demand-led redevelopment policy - projects initiated by owners but executed by the authority - which is said to have led to HK$3 billion in losses since it began in 2011. "The project's failure will be part of the review," the spokesman said.

The authority has accepted 11 such projects in all. So far, seven have been given the green light by owners while two - the To Kwa Wan and Sham Shui Po projects - have fallen through. It is not known if the authority will kick-start the remaining two projects, which have not been announced, before it completes its review by the end of the year.

The To Kwa Wan project, involving 170 households and 387 residents, was expected to provide 150 flats, a commercial area and community facilities.

"It's unfortunate to miss the opportunity to revitalise the old neighbourhood, but I respect the owners' decision," district councillor Starry Lee Wai-king, who was involved in the project, said. "It's hard to ask investors who are renting out their flats to accept an offer lower than they expect."

Property prices are still rising despite the introduction in February of double stamp duty on buying a second flat. Figures from the Centa-City Leading Index show that flat prices have risen 7.5 per cent since the measure was implemented.

But Chau kwong-wing, chair professor of the University of Hong Kong's real estate and construction department, said the market would see downward adjustment in the longer term, perhaps in five years. On the To Kwa Wan project, Chau said: "The authority may not want to go ahead with it either, given the losses on past projects."

 

This article appeared in the South China Morning Post print edition as: To Kwa Wan flats project collapses
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