A consortium led by Shun Tak Holdings has agreed to pay the Government a land premium of more than $5 billion, clearing the way for an $11 billion residential development to go ahead at west Mid-Levels. Shun Tak yesterday said a consortium in which the company owned 51 per cent had accepted the premium of $5.29 billion offered by the Lands Department for the Belcher Gardens redevelopment site. The company said the acceptance of the land premium was made 'after careful consideration and as supported by recent rising residential property selling trends'. The $5.29 billion comprises a land premium of $373 million for the modification and an additional redevelopment premium of $4.917 billion for the 322,920 sq ft Belcher Gardens site. Based on the premium, the average accommodation value of the project is estimated at $1,900 to $2,000 per square foot. Land premiums charged by the Government are calculated on the projected enhanced value of the site once the redevelopment has been completed. This is based on the value of typical comparable properties in the area, taking into account projected price trends. With the acceptance of the land premium, the total cost of the redevelopment was expected to be between $10 billion and $11 billion, higher than previous forecasts of $6 billion to $7 billion, according to the company. The Belcher Gardens redevelopment is situated at west Mid-Levels on Pokfulam Road and is a joint venture, with 51 per cent owned by Shun Tak and 29 per cent by Sun Hung Kai Properties, 10 per cent by New World Development Co and 10 per cent by Liu Chong Hing Investment. The company also said the funding of the redevelopment would be met partially out of existing financial resources and bank facilities and partially out of financing arrangements to be put in place for that purpose.