Government's lease modification mechanism effective


The criteria adopted by the Government in processing applications for lease modification are to take into account various factors including Hong Kong's economy and the market condition and to ensure that overall public interests are safeguarded, the Secretary for Housing, Planning and Lands, Mr Michael Suen, said today (September 3).


Speaking to the media after officiating at the Hong Kong Housing Society's launching ceremony of Cheerful Court of the Senior Citizen Residence Scheme, Mr Suen said, "To ensure that the limited land resources can be sustained, the Government has in place an effective way to process lease modification applications. The mechanism has all along been effective and well known to the property sector and developers."


"Everyone knows that applications for lease modification must be made to the Government to modify the land use. It is not at all surprising for the Government and individual applicants to hold divergent views over the level of land premium. This also happened in the past. In most of the circumstances, such cases were able to be resolved in a rational manner," Mr Suen said.


The Lands Department has been processing each application for lease modification according to the above principles. In general, the premium for lease modification should be equal to the difference between the value of the land under the originally permitted land use and its value under the modified land use.


In assessing the land premium, the Lands Department will carefully examine all available market evidence relating to actual government and private land transactions, and make adjustments to take account of any difference in location and site characteristics.


If there is disagreement on the level of premium offered by the Lands Department, the lease modification applicant may make an appeal to the Department on the premium assessed. The applicant and his agent will be offered the option of attending the Department's valuation meeting to present their case.


Ends/Friday, September 3, 2004