An dissertaton reference about real estate

Developers targeting old buildings    
       
Developers are aggressively hunting for old buildings to redevelop and that means more and more of the quaint old shops that give Hong Kong its unique architectural heritage are disappearing from the streetscape. Fifty years ago, Victor Sin Ho-yuen's father opened a small trading shop called Yat Lee Oil and Soy Sauce Shop. Ten years later, he bought another shop and then owned two shops at 42 and 44 Haven Street in Causeway Bay.    
      
But now the shop at 44 Haven Street has been bought by a developer and shut down pending its redevelopment because Sin lost his bid at the Lands Tribunal to oppose a redevelopment buyout accepted by the majority of owners in the building in which the shop was located.  '
Three years ago the developer [Soundwill Holdings] offered HK$15 million to buy our shop at 44 Haven Street. But that would not have been enough for us to buy another shop somewhere else in Causeway Bay, so we turned it down,' said Sin. 'Our family has lived and done business in this district for 50 years. We want to stay here.' However, the flat owners in the building in which Sin's shop was located agreed to the developer's general offer. 
         
Their acceptances were sufficient to trigger the Land [Compulsory Sales for Redevelopment] Ordinance, opening the way for a compulsory takeover of all the units since the developer had secured the nod of more than 90 per cent of the owners in the building. Sin then hired property experts and lawyers to argue a case before the tribunal that the building was still in good condition and therefore did not qualify under the ordinance as a target for compulsory acquisition for the purpose of redevelopment. But the Lands Tribunal dismissed the argument and approved the compulsory sale. Sin was also ordered to pay costs. 'It cost me more than HK$2 million. Not many flat owners could afford the cost of opposing developers. The system is unfair to individual owners,' said Sin, who was forced as a result of rejecting the developer's offer to accept a court-ordered valuation of just HK$8.5 million for his 1,200 square foot shop when the developer moved to compulsory acquisition of the building at the auction that followed. His other shop along with a flat at 42 Haven Street is now also the target of the same developer.            
 For the moment the developer has not been able to move to compulsory acquisition since it has only secured agreement from 80 per cent of the owners in the second building. The Denmark Cake Shop, located for the past 30 years on the ground floor of Lei Shun Court in Leighton Road, is facing the same challenge to its continued existence. Richfield Realty and Centaline Property Agency are bidding for appointments to secure sales agreements from owners in the building.  'More and more of Hong Kong's old shops are disappearing in the city as urban redevelopment has speeded up in recent years,' a surveyor said. Professional Property Services Group chairman Nicholas Brooke said redevelopment inevitably brought in its wake disruption and the need for owners to relocate.  'That's why we need to consider the option and alternative of regeneration and revitalisation wherever possible on a district or precinct basis,' he said. 'The focus under this scenario should be refurbishment and renovation and should neither change the character of the area nor mean the loss of the old shops.'            #p#分頁標題#e#
Brooke said this would require the creation of a financial or funding model that helped owners through loans, grants and dollar-matching initiatives. 'It will also require a change of mindset by the government, the Urban Renewal Authority and the development community. But the pressure is there for such change.'  Kim Chan, a vice-president at Hong Kong Institute of Planners, echoed these sentiments. 'We can't save every old shop, otherwise Hong Kong will become an old town. But the government should make more effort.  'It should identify which street and which area in which district should retain their unique character.'         
  
In Wong Tai Sin, metals businessman Chan Kam-man wanted to sell his old flat and teamed up with other owners to appoint surveyors to prepare an offer for a developer to buy out their units in four buildings on Po Kong Lane in 2006. 'Our buildings do not have lifts, which meant it is inconvenient for the elderly. My 80-year-old mother has knee problems so she had to move out. I want to sell my flat and buy one in a newer building to live with her,' Chan said.  'Most of the flat owners are more than 60 years old. We want to sell our old flats and buy new ones to improve our living environment and prepare for the future.' According to the tender offer prepared by the owners, Chan could sell his unit for up to HK$7 million, a much higher price than he could achieve through an individual sale in the secondary market. However, his dream has not materialised.  The estate comprises four 44- to 45-year-old buildings.    
      
 While 90 per cent of owners at three of the buildings have agreed to sell, just 80 per cent of the owners in the fourth building have so far agreed. The rest are looking for a higher offer from another developer.  'While we were negotiating with the other flat owners to agree to sell, the government imposed building height restrictions on our site and the developer immediately lost interest,' Chan said. 'Now we are back to selling our units in the secondary market, but our building is old. It takes time to find buyers. If the government lowered the threshold to trigger compulsory acquisitions a few years ago, we might have already sold our units.' Opinions on the threshold differ, but Brooke believes the present requirement that developers must secure agreement to sell from 90 per cent of owners is too high. 'The present threshold is restrictive and thwarts many genuine attempts by owners and developers to redevelop properties which are well past their working life and which do not merit retention on heritage and other grounds,' he said. 'Essentially, it means that the proponents often find themselves having to pay what is in effect a ransom price to reach 90 per cent.' 

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