'Private sector should take lead in urban renewal'
The private market’s ability to redevelop Hong Kong’s ageing residential stock far exceeds that of the Urban Renewal Authority (URA), a development official said on Friday as she detailed the government’s strategy to unlock greater market participation in urban renewal. Speaking on an RTHK radio programme, Permanent Secretary for Development (Planning and Lands) Doris Ho said that the private…
The government believes the private sector can lead urban renewal efforts in Hong Kong, a development official suggested on a radio show. Doris Ho, Permanent Secretary for Development (Planning and Lands), pointed out that private developers have typically built about 80% of new residential units from redevelopment projects, while the Urban Renewal Authority (URA) contributes only the remaining 20%.
To stimulate market participation, Ho proposed the government's upcoming Bonus Plot Ratio Pilot Scheme, set to begin in September. This initiative offers an extra 20% premium-free gross floor area bonus to developers undertaking redevelopment of aging residential buildings in seven designated old districts. Ho expressed confidence that this incentive would make previously unprofitable projects financially viable.
According to the URA's analysis, in densely populated areas like Mong Kok and Yau Ma Tei, 90% of potential redevelopment projects are not attractive enough to developers without such a boost. The scheme provides developers the option to apply the bonus directly on-site or convert it into cash-equivalent value, which can be used to offset land premiums for land exchanges or reduce premiums when bidding for government sites.
Ho emphasized the scheme's flexibility and pledged to review its performance within one to two years.
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- 'Private sector should take lead in urban renewal' news.rthk.hk
