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SCMP Reporter

There was a knock at the door. It was a young woman with a pen and a clipboard. She wanted to know if we were interested in selling our flat.

  Then she mentioned the price she had in mind.

  After picking my chin up off the floor and re-attaching it to my mandible, I told her that I would move the family and all belongings to a bench in the sitting-out area down the street within 40 minutes.

  I had better add that we do not live in what is generally described as an 'exclusive and sought-after bijou residence'. We live in a block so humble that when we bring guests home, they think we are taking a short cut through a derelict tenement.

  Our lift is so old that you have to open the door by hand, and many visitors just stand bemused in front of the lift. Our neighbours are so traditional that at the appropriate festival times, they light bonfires - in the corridors.

  But did the young woman at the door hand over the cash? No. She moved on to ring the bell of the next flat, explaining that she would have to get agreement from all flat-owners in the building before trundling my personal wheelbarrow-full of money around.

  Consulting people in the property business, I made an amazing discovery. The fall in the cost of property means there is an army of people like the woman who knocked on my door, going around all the older blocks in Hong Kong.

  They have found what used to be called the Philosopher's Stone: the rock that could be transformed into gold.

  Only, the Hong Kong 1996 version is better. It is a formula that turns thin air into some of the most expensive real estate in the world.

  Ingredients: champagne, ink, clipboard, telephone.

  Method: 1. Buy a small building. 2. Knock it down. 3. Replace with a tall building. 4. Collect $100 million in profit, drink champagne, buy Ferarri, etc.

  The calculations are easy enough. A crumbly, block of 23 small apartments on Caine Road, Central, is worth, say, $69 million. Once you have said the magic words 'plot ratio', you can replace it with a 29-storey tower containing 84 flats, which would be valued on the open market at about $252 million.

  The difference is not all pure profit, of course. You have to deduct the cost of the pen and the clipboard and stuff. I also consulted an old businessman who had owned properties in Hong Kong for many decades.

  'Don't get your hopes up,' he said. 'Whether it's a small low-rise block of a handful of flats, or a huge complex of 1,000 flats, there is always one little old man who refuses to sell, and then the whole scheme is scuppered.'   Sure enough, one little old man refused to sell, and the whole scheme was scuppered.

  This scenario now plays itself out every couple of months at my block. The cycle is always the same. Someone makes an offer for the flats, which can only be accepted if all tenants agree.

  A residents' meeting is called. These are remarkable affairs. In my block, the owners range from elderly retirees to a Buddhist priest - a serious, shaven-headed monk, who attends all meetings in his robes.

   There's no airy, false spirituality about him. He fights for the best possible price for his flat just like any other resident.

  The others are mostly local middle or working class people. Conversation is always loud and excited, and much too fast for the two foreigners (myself and a German import-export man) to keep up with.

  Much tea is consumed and passionate discussion ensues as to whether the offer is good enough, or whether a better one will come along if we wait.

  And the conclusion is always the same. Everyone at the meeting agrees to sell, but when the date comes to sign the contracts, there is one little old man or woman who decides not to move (a different one every time), and the scheme is cancelled.

  The latest batch of developers are using psychological tricks. They had gone to the trouble of preparing cheques in the names of every owner in the building. They flashed them about carelessly, and the urge to reach out and grab one was immense.

  'That's just temptation,' one of the other residents said to me.

   Although the deadline for acceptance is not for another two weeks, I know that at least one family has already decided to refuse it - and thus the whole deal will be abandoned yet again.

  What does one do at a point like this? Traditionally, one hires triads to rough up the difficult ones so that they move out.

  But this is not for me. I like my neighbours. And besides, there's nothing listed under triads in the phone book. I've already looked.



Knock knock knocking on fortune's door