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The company that handles sales of the  expensive properties around the country  club vets all would-be owners

Some of Hong Kong's most luxurious and expensive homes are located around the Shek 0 Country Club. These 20 or so large detached houses with private gardens and sea views cost tens of millions of dollars.

Their owners include the chairman of Wheelock and Company, Peter Woo Kwong-ching, and Sino Land boss Robert Ng Chee-siong.

But how someone gets to live in this exclusive area is a mystery. Wealth is not the sole requirement as new residents need to be approved by private firm Shek O Development, which owns the country club with its golf course and leases out all the nearby plots on which the exclusive houses are built.

Little is known about how Shek O Development decides whether to accept or reject new residents but the committee of the country club is thought to be closely involved.

Koh Keng-shing,  managing director of estate agent Landscope Realty, claimed some of his clients were prevented from buying one of the luxury houses by Shek O Development despite being able to afford the properties. Mr Koh declined to reveal his clients' identities.

'It is not just money that will work - you need to have good connections, you need to have good social status and also you need to have an extremely good reputation in  high society,' said Mr Koh. Requests for interviews with Shek O Development's directors and shareholders were all turned down.

Director Tim Freshwater wrote in an e-mail: 'Shek O Development Company is, as you know, a private company and the questions you raise are largely confidential matters. I am afraid, therefore, that I will not be able to answer these or any questions regarding the company or the [country] club.' Mr Freshwater is also head of Asian corporate finance at Goldman Sachs.

Shek O Development's directors and shareholders are among the most powerful business figures in Hong Kong. Directors include HSBC Asia-Pacific chairman David Eldon and Cathay Pacific chief executive David Turnbull. The largest shareholder is Jardine Matheson managing director Percy Weatherall. The country club was formed by an association of British hongs,  according to Mr Koh.

'The majority was really controlled by Jardine Matheson,' he said. In 1934, Shek O Development leased the  10.48 hectares of land on which the luxury properties are built from the colonial government for 75 years starting from 1924. The lease was renewed for another 75 years in 1999. The plots on which the exclusive houses  were built were then sub-leased with numerous restrictions.

The property cannot be sold without written permission of Shek O Development, according to the firm's standard sub-leasing contract, which is the same as the one used 70 years ago. The houses on the property must be of a 'European type'. No reconstruction or alterations can be carried out without Shek O Development's permission.

'Over the years they have been sticking very strictly to the rules. There are very few houses that have successfully applied for extensions of the house areas,' said Mr Koh.

Even the colour of the house is not just the choice of the residents. 'You are not allowed to change the colours on your external walls or the roof unless you have the permission of the committee of the [country] club,' said Mr Koh.

The contracts also stipulate that residents cannot become a scavenger, blacksmith, tavern-keeper, soap-maker, sugar baker, butcher or melter of tallow among other occupations without the express permission of Shek O Development.

All these restrictions may help preserve the splendour of the area but they can also depress the value of the properties.

One owner of a large Shek O residence noted the country club committee's role in approving would-be buyers put a cap on values compared with other salubrious Hong Kong neighbourhoods.

While developers have bulldozed old colonial villas on The Peak and Deepwater Bay to make way for multiple house and condominium projects, the committee's control over new buildings and their right to veto potential property buyers has depressed prices.

'Shek O property really should not be seen as an investment like other areas of Hong Kong,' the owner said.

Despite all the safeguards and restrictions to preserve the good name of the area, some residents have received negative press coverage. Akai Holdings chairman James Ting used to live at 20 Shek O.

Mr Ting was arrested in May in connection with investigations into the collapse of his flagship company Akai Holdings.



Connections the key to Shek O's luxury life