The board cited the garden's Chinese Renaissance architectural style and the fact it was designed by renowned architect Chu Pin.

A statement by the board said: 'The historical value, architectural merit, authenticity, rarity, integrity and social value of the historic buildings are taken into account when buildings are categorised.

'Similar architectural work of such a high standard of workmanship is rarely found in Hong Kong.'

The garden made headlines when Cynthia Lee Hong-yee, a granddaughter of the tycoon, made a public appeal to prevent the sale of the estate to property developers for $130 million.

Family members had said the buyer was linked with Sun Hung Kai Properties but the developer denied this. Eventually, her uncle, Lee Shiu, youngest son of the tycoon, bought the garden from the family. He pledged to donate it to a charitable trust fund and open it to the public.

Its grading gives the garden heritage status but without the legal protection afforded by a declaration as a 'monument'. As a formality, the owner of a grade-two building needs to consult government departments before tearing it down. However, the government has no power to stop demolition. While welcoming the recognition, Ms Lee said it was unclear what significance it had, given that the trust had already been established to manage the garden.

'It would have had huge significance if it came when we needed to stop it from going into the buyer's hands to be demolished, but now the government knows that my uncle is donating it to them,' she said.

'I don't know exactly what their criteria are in deciding whether it's a higher grade, grade one or a monument ... grade two does not mean it cannot be demolished. We don't know what the grading does.'

The director of the architectural conservation programme at the University of Hong Kong, Lee Ho-yin, said the grading simply 'states the importance of this place in terms of heritage value'.

'It means the general public is going to look at it differently, but I am surprised - I thought it would deserve a greater status. Grade one would have meant it had the highest chance of being declared a monument. Personally I think the garden is quite rare, quite peculiar to southern China.

'There was a certain time when a few people making a lot of money would invest in such a grand garden that was then opened up for public access.

'Tiger Balm was a prime example of how a private garden was opened up for public use when the general public was relatively poor in Hong Kong and didn't have a lot of recreational options.

'It shows what a special place this is. The importance lies with the social and historical significance behind this garden.'

The government is providing transitional site management for the garden, but Ms Lee said the servicing lacked sensitivity. 'I was there today and the grounds at the mausoleum were full of tiles that had come off the roof before.'

Government figures show that 215 buildings have been accorded grade two status, while about 120 have grade one and about 200 grade three status. There are 80 recognised monuments in Hong Kong.