Link Reit cheated Hong Kong homeowners out of millions after failing to honour repair and maintenance agreement, investigation finds
Report says the Link was obliged to pay between 6 and 49.2 per cent of maintenance costs for common areas at 23 estates – but only did so on three occasions
Hong Kong’s Link Reit has been accused of reneging on obligations to pay its fair share of repair and maintenance costs at a number of subsidised housing estates, leaving some homeowners HK$10 million (US$1.3 million) out of pocket.
The Link, the largest real estate investment trust in Asia, adhered to a covenant-bound cost-sharing arrangement at just three out of 23 Home Ownership Scheme (HOS) estates in the city, an investigation by local news agency FactWire found.
Homeowners at these estates were paying millions of dollars more than they should have for repair projects, the report said, citing documents obtained through Hong Kong’s Code of Access to Information.
This was despite the developer agreeing to a little-known “split-ratio covenant” with the Housing Authority when the government divested ownership of retail and parking facilities to the listed trust in 2005.
According to the agreement, the Link was obliged to help shoulder anywhere from 6 to 49.2 per cent of the costs of “management, repair, maintenance, renewal and replacement” of common areas and facilities at these estates.