The Urban Renewal Authority (URA) has sealed a deal with homeowners in a dilapidated block of flats to redevelop the building, in what's being called a historic breakthrough.
URA chairman Barry Cheung Chun-yuen announced yesterday that 229 Hai Tan Street in Sham Shui Po looked set to become the first building to benefit from a pilot scheme in which homeowners can invite the authority to redevelop a site.
Cheung said the URA has secured the consent of 80 per cent of the building's homeowners, the threshold required by the scheme, and the project would now be passed to the Development Bureau for final approval.
"This is a historic breakthrough as well as a milestone for the URA," Cheung said. "I hope this can become the mainstream redevelopment format in the future."
The URA offered the homeowners HK$8,830 per square foot of saleable area, which is about the price fetched by flats in Sham Shui Po that are around seven years old.
The authority hopes to build 70 small- to medium-sized flats on the 483 square metre plot, and the first new residents are expected to move in around 2017 or 2018.
"We invited an independent expert to estimate what price we should offer … I found this offer attractive enough," Cheung said.
However, one elderly woman living in the building was quoted as saying that she only agreed to the redevelopment because she did not want to cause trouble for the rest of the residents.
Under the URA's HK$1.5 billion, demand-led scheme introduced last year, initial applications must be made by at least 67 per cent of residents. The buildings must be in a dilapidated condition and the site must cover at least 400 square metres.
The application process earlier this year saw only three out of 25 proposals from homeowners accepted. Once an application is selected, residents and the URA then have a deadline to achieve an 80 per cent consensus in the particular building.
So far only about 70 per cent of homeowners in the two other buildings selected from the first batch of applications have given their consent.
However, the URA has yet to give residents a price per square foot for the blocks, one of which is also in Sham Shui Po, with the other in Tai Kok Tsui. The offer will be made only after 80 per cent of homeowners declare their interest.
URA executive director Iris Tam Siu-ying said that those who had not agreed to a URA redevelopment of their buildings were mostly investors who were renting out their flats.
So far, homeowners have put forward 34 buildings in the next batch of applications for the scheme.
Meanwhile, Cheung said that he was looking at standing down as chairman of the URA when his term ends in the middle of next year.