FRIDAY, JANUARY 17, 1975.
NEW MOVE TO ENCOURAGE LAND DEVELOPMENT
THE GOVERNMENT IS TO EXTEND ITS POLICY OF ACCEPTING PREMIUM FOR SALES AND OTHER LAND TRANSACTIONS BY INSTALMENTS IN A NEW MOVE TO ENCOURAGE INDUSTRIAL, COMMERCIAL AND RESIDENTIAL DEVELOP- MENT THROUGHOUT HONG KONG.
J
PREVIOUSLY THE FACILITY OF PAYING LAND PREMIA BY INSTALMENTS WAS CONFINED TO THE MORE DISTANT INDUSTRIAL AREAS IN WHICH THE GOVERNMENT WISHED TO ENCOURAGE THE CONSTRUCTION OF NEW FACTORIES, AND VERY VALUABLE COMMERCIAL SITES IN THE CENTRAL AREAS OF HONG KONG AND KOWLOONS.
THE NEW POLICY WILL APPLY TO SALES OF INDUSTRIAL LAND IN ALL PARTS OF HONG KONG, AND TO ALL SALES OR TRANSACTIONS INVOLVING COMMERCIAL OR RESIDENTIAL LAND WHERE THE PREMIUM IS ESTIMATED TO EXCEED $10 MILLION.
IN ADDITION INSTALMENTS MAY BE PAID WHERE AN INDUSTRIALIST SEEKS A MODIFICATION OF HIS LEASE TO REMOVE RESTRICTIONS ON ITS DEVELOPMENT POTENTIAL PROVIDED THE PREMIUM FOR THE MODIFICATION EXCEEDS $1 MILLION.
FOR SALES OF INDUSTRIAL LAND, PREMIUM WILL BE PAYABLE BY TEN INSTALMENTS WITH INTEREST CALCULATED AT FIVE PER CENT, WHICH WAS THE RATE OF INTEREST USED FOR INDUSTRIAL LAND UNDER THE OLD SYSTEM. IN THE CASE OF GRANTS FOR SPECIAL INDUSTRIES AND MODIFICATIONS OF INDUSTRIAL LOTS WHERE THE PREMIUM IS SETTLED BY NEGOTIATION AND NOT BY COMPETITIVE MEANS THE INTEREST IS TO BE 10 PER CENT.
FOR RESIDENTIAL SITES THE PREMIUM WILL BE PAYABLE AT 10 PER CENT INTEREST PER ANNUM.
COMMENTING ON THE NEW POLICY THE DEPUTY SECRETARY FOR THE ENVIRONMENT, MR. GRAHAM BARNES, SAID THAT THE GOVERNMENT WAS CONCERNED TO ENSURE THAT THE DEVELOPMENT OF LAND CONTINUED SMOOTHLY. A SYSTEM OF DEFERRED PAYMENTS WAS OF CONSIDERABLE BENEFIT TO DEVELOPERS BECAUSE IT REDUCED THE INITIAL CAPITAL' INVESTMENT REQUIRED BEFORE DEVELOPMENT COULD BEGIN.
+THE SITES AVAILABLE FOR SPECIAL INDUSTRIES GRANTS AND FOR THE KIND OF MAJOR RESIDENTIAL SCHEMES WHICH ARE BEING CONSIDERED AT THE PRESENT TIME, ARE FREQUENTLY DIFFICULT AND SITE FORMATION COULD TAKE AT LEAST A YEAR BEFORE CONSTRUCTION WORK ON THE BUILDINGS COMMENCED.<
MR. BARNES SAID THIS WAS AN EXPENSIVE PERIOD FOR DEVELOPERS, AND IN SOME CASES IT WAS PROBABLE THAT IMPORTANT RESIDENTIAL AND INDUSTRIAL SCHEMES WOULD NOT PROCEED IF FULL PREMIUM WERE REQUIRED AT THE OUTSET. FROM THE GOVERNMENT'S POINT OF VIEW THE SYSTEM OF DEFERRED PREMIUM WOULD PROVIDE FOR A STEADY RETURN ON ITS LAND ASSETS.
A. BAINES