Property acquisition for Kwun Tong Town Centre project to start soon
The Urban Renewal Authority (URA) will issue purchase offers to
owners of all 1,657 legal property interests of the Kwun Tong Town
Centre project (Project K7) before the end of this month to acquire
their property interests. The Land, Rehousing and
Compensation Committee of the URA Board today (Tuesday) endorsed a
unit rate of $5,937 per square foot of saleable floor area for a
notional 7-year-old flat in respect of the project.
Speaking to the media representatives this afternoon, the Chairman
of the URA, Mr Barry Cheung, said: "The unit rate is assessed in
accordance with the established mechanism of the URA which is open,
fair and transparent. Because of the large number of property
interests involved and taking into account the views of the
affected residents and the community, the URA has enhanced the
valuation mechanism by appointing 11 independent valuation firms
instead of the usual practice of commissioning seven to perform
assessment of the unit rate of a notional 7-year-old flat for
Project K7."
The URA requested some 70 surveying firms registered with the Hong
Kong Institute of Surveyors (HKIS) to express interest in taking
part in the assessment of the unit rate of the notional 7-year-old
flat. In July this year, the URA held an open ballot to
select the 11 surveying firms, in which members of the Kwun Tong
District Council, representatives of owners and the HKIS invited by
URA had attended to the ballot. The process was open,
objective and fair. These 11 surveying firms comprising local
and international companies, with over 40 experienced practising
surveyors, worked in conjunction with their own specialised
research teams on the valuation assessments. At the same
time, three qualified surveying firms, instead of the usual
practice of commissioning two, have been appointed to assess the
market value of each domestic property interest, and also three
more qualified surveying firms to assess the market value of each
non-domestic interest of the project.
The purchase offer for domestic properties is based on the Home
Purchase Allowance (HPA) policy approved by the Finance Committee
of the Legislative Council in 2001 in which it is the difference
between the market value of the acquired property and that of a
notional seven-year-old flat of similar size in a similar
locality. The notional flat is situated at the middle floor
of a notional building with average orientation, i.e. not facing
south or west, and without sea view.
In addition to the market value of the acquired properties,
eligible owner-occupiers will receive the full HPA amount whereas
owners of tenanted and vacant domestic properties will receive a
supplementary allowance (SA) up to half of the HPA.
Mr Barry Cheung emphasised that the unit rate assessed by the
appointed surveying firms is fair and reasonable. Although there is
an absence of comparable buildings of a notional seven-year-old
flat in Kwun Tong, valuation has been made with reference to
transactions of comparable buildings in comparable districts with
characteristics and transport network similar to Kwun Tong.
Hence, the comparable buildings selected are not confined to those
in Kwun Tong.
The districts chosen included Kwun Tong/Lam Tin, Choi Hung,
Diamond Hill, Wong Tai Sin, San Po Kong, Hung Hom, Mongkok and
Yaumatei A total of 22 comparable developments/buildings were
selected, for which the 11 valuers conducted a total of 389
comparable analyses.
"Based on these comparables, appropriate adjustments are made to
factors such as the valuation date (1 December 2008), building age,
floor, orientation, quality, size, accessibility and environment so
as to arrive at the unit rate of a notional 7-year old flat",
Mr Cheung added. The 11 surveying firms have given a detailed
account of the selected districts and comparable transactions for
the assessment in their valuation reports, in both English and
Chinese. Copies of the reports and their company profile will
be disclosed and placed in the Resource Centre at Kwun Tong by the
end of this month for owners' information.
On the availability of flats, Mr Cheung said the URA's
property consultant's preliminary study estimated that there
are about 2,500 flats intended to sell in the second-hand property
market of the districts in the vicinity of Kwun Tong, as well as in
the districts where comparable buildings are selected by the 11
surveying firms for assessment. Out of the 2,500 flats, there
are about 750 flats with asking prices in the region of
$2.5M.
Owners will have ample time to consider the URA's offer and to
accept the offer within 90 days after receiving it, unlike the
normal practice of a 60-day acceptance period. Eligible
owner-occupiers of domestic properties will receive an Incidental
Cost Allowance (ICA), where applicable, as an incentive for them to
accept the offers within the 90-day period. The current ICA
for owner-occupied domestic property is $111,900 or $111 per square
foot ($1,195 per square metre) of saleable floor area, whichever is
higher. For domestic property which is tenanted or vacant, the ICA
is $87,700.
Mr Cheung said, "It's entirely up to individual owners to decide
how they are going to use the compensation they receive, whether to
buy or to lease a flat. At the end of the day, it will create
a chain effect giving an impetus to a range of economic activities
and creating at least 1,000 working opportunities.
A series of briefing sessions on the acquisition and rehousing
arrangements will shortly be held for the affected owners,
residents and shop operators after the issuance of purchase
offers. The Resource Centre at Hip Woo Street, Kwun Tong,
will at the end of this month extend its office hours from 9 am to
9 pm, seven days a week, to provide one-stop service to residents
in need. The enquiry number of the Resource Centre is 2110
5858.
Meanwhile, the urban renewal social service team of the Christian
Family Service Centre will also step up its resources to provide
professional and counselling services alongside URA frontline staff
for the affected residents. Residents and owners who want to
make enquiries may also call the URA hotline 2588-2333.
The following are attached for information:
- List of 71 surveying firms registered with the HKIS who were invited by URA to express interest in carrying out the assessment of 7-year old flat for Project K7.
- List of 11 surveying firms appointed for the 7-year-old flat assessment (including the lists of surveying firms appointed for the market value of individual domestic and non-domestic property interests).
- The result of the assessments of 7-year old flat by the 11 surveying firms.
- List of comparable districts and buildings chosen for assessment of 7-year old flat.
- Examples of acquiring replacement flats
Appendix 1-5 (Chinese only)
(ENDS)