URA Issues Acquisition Offers for Shing Tak Street / Ma Tau Chung Road Development Project
The Urban Renewal Authority (URA) today (5 August 2021) issued acquisition offers to property owners of the first URA’s pilot project authorised by the Government in Kowloon City, namely, Shing Tak Street / Ma Tau Chung Road Development Project (the Project), to redevelop buildings under the Civil Servants’ Co-operative Building Society (CBS) Scheme. The Land, Rehousing and Compensation Committee (LRCC) of the URA Board has earlier approved to offer owner-occupiers of the Project $19,848 per square foot of saleable area, which is the unit rate of a seven-year-old notional replacement flat of the same locality (Notional Unit Rate).
In line with the established mechanism, the URA appointed seven independent consultancy firms by open ballot to assess the Notional Unit Rate for the Project. These independent surveyors selected and compared transaction records of comparable properties in the vicinity of the Project, which shared similar characteristics and access to public transport as the properties under acquisition, to derive the Notional Unit Rate.
The process involved in the redevelopment of CBS buildings is more complicated than that of other old private buildings, in which a range of processes, covering the dissolution of co-operative societies, modification of the Government lease, assigning flats to ex-CBS members, and setting up owners’ corporations by ex-CBS members are involved. Upon acquiring the titles of CBS properties by ex-CBS members, a legal charge in favour of the Government will be executed until the CBS owners pay the outstanding land premium to the Government to remove the alienation restrictions. After which, the owners may dispose of their flats as they wish.
In view of the complexity, the URA has made its best endeavours to launch five new initiatives to cater for the needs of CBS members. These initiatives include:
- Providing free legal service to facilitate the dissolution of the CBS;
- Facilitating the Government to adopt “existing use land value” of old CBS buildings as the basis in assessing the amount of land premium;
- Introducing a levelling adjustment to align the rate of the premium per square foot to be paid by CBS owners. The lowest unit rate of the premium per square foot assessed by the Lands Department for all residential properties with outstanding premium in the Project will be adopted as the reference rate. The reference rate of the premium at $2,661 per square foot has been adopted for this Project, and any amount payable to the Government above the reference rate will be borne by the URA;
- Facilitating the waiving arrangement of the administrative fee for the removal of alienation restriction and remission of Ad Valorem Stamp Duty and Special Stamp Duty relating to the conveyancing of the eligible CBS properties;
- Considering that a portion of the compensation amount offered by the URA may be used to repay the outstanding premium, the Government and the URA have made special arrangement for eligible ex-CBS members to purchase replacement flats. They are allowed to purchase the subsidised sale flats of dedicated rehousing estates to be developed and managed by the Hong Kong Housing Society, as an alternative option to the “Flat-for-Flat” units and “Kai Tak Development” units provided by the URA. Flexibility will be given to enable eligible ex-CBS members to purchase a maximum of any two flats of these three types of replacement units.
The Project covers about 155 property interests with flat sizes ranging from around 800 square feet to 1,600 square feet. All property owners will have 60 days to consider the URA’s acquisition offer. The details are given in the offer letters.
The URA will organise briefings for the affected owners/ex-CBS members to explain the acquisition and rehousing arrangements, and to provide individual assistance to owners who have yet to pay premium in handling the processes of premium payment. An urban renewal social service team staffed by professional social workers from Hong Kong Lutheran Social Service (Tel.: 3596 6850) has been appointed by the Urban Renewal Fund to assist owners and residents in need.