Property acquisition for two URA redevelopment projects to start soon
The Land, Rehousing & Compensation Committee of the Urban
Renewal Authority (URA) has resolved today (Wednesday) that
eligible owner-occupiers of domestic properties affected by two
redevelopment projects at Shun Ning Road in Sham Shui Po and San
Shan Road / Pau Chung Street in Ma Tau Kok would be offered $6,297
and $7,246 per square foot of saleable area respectively.
The URA will issue offer letters to property owners of the two projects by 30 April 2010, who will have 60 days to consider and accept the offers.
The Shun Ning Road and the San Shan Road / Pau Chung Street projects affect a total of 42 and 83 property interests respectively.
The acquisition offers for domestic properties are based on the Government's Home Purchase Allowance (HPA) policy in which HPA is the difference between the market value of the acquired property and the value of a notional replacement flat of seven-year-old in a similar locality. In addition to the market value of the acquired properties, eligible owner-occupiers will receive the full HPA amount whereas eligible owners holding wholly tenanted or vacant domestic properties will receive a Supplementary Allowance (SA) up to half of the HPA.
For illustration purpose, if the above unit rate of $6,297 per sq. ft. for Shun Ning Road project in Sham Shui Po applies to the owner-occupier of a domestic property with a saleable area of 730 sq.ft., the offer amount (market value plus HPA) will be about $4,596,810 and with a gross floor area of 800 sq.ft. for that unit, the gross floor area unit rate of that unit will be about $5,746 per sq. ft..
For San Shan Road/Pau Chung Street project in Ma Tau Kok, if the above unit rate of $7,246 per sq. ft. applies to the owner-occupier of a domestic property with a saleable area of 550 sq.ft., the offer amount (market value plus HPA) will be about $3,985,300 and with a gross floor area of 620 sq.ft. for that unit, the gross floor area unit rate of that unit will be about $6,428 per sq. ft..
A spokesman of the URA said: "In accordance with established mechanism, the URA has appointed seven independent valuation firms for the valuation of the unit rate of the notional seven-year-old flat. The whole process is virtually transparent, open and fair."
Owners of domestic properties will also receive an Incidental Cost Allowance (ICA) as an incentive for them to accept the offers within the 60-day period. The current ICA for owner-occupied domestic property is $112,700. For domestic property that is wholly tenanted or vacant, the ICA is $ 88,300.
For non-domestic properties, the acquisition offers to eligible owners will include an ex-gratia allowance on top of the market value. The allowance for tenanted or vacant non-domestic property is 10 per cent of its market value or one time the rateable value, whichever is higher. The allowance for owner-occupied non-domestic property is 35 per cent of its market value or four times its rateable value, whichever is higher.
The market value of each property is based on the higher valuation of two independent valuation firms appointed by the URA.
Eligible owners and tenants who operate businesses in the affected non-domestic properties will enjoy an additional Ex-gratia Business Allowance (EGBA) up to three times the rateable value of their respective properties, payable at the rate of 0.1 time the rateable value for each year of continuous occupation of the premises up to a maximum of 30 years, subject to a minimum amount of $70,000 and a maximum of $500,000. This allowance is intended for alleviating the possible business loss due to the redevelopment.
The spokesman reiterated that in accordance with prevailing policy, landlords would not get any additional compensation for terminating the tenancies with their tenants since their eligibility to compensation was based on the occupation status of the properties on the date of freezing survey.
Upon completion of the property acquisition, the URA will make ex-gratia payment or rehousing arrangement for the tenants concerned, if eligible.
The URA will organise a series of briefings for the affected owners, residents and shop operators to explain to them the acquisition, ex-gratia payment and rehousing arrangements. An urban renewal social service team staffed by the Salvation Army has been appointed to provide professional and practical services alongside URA frontline staff for the affected occupants. Residents and owners who want to make enquiries may also call the URA hotline 2588-2333.
Both projects are residential developments with commercial floor area, scheduled for completion by 2016/2017.