,a
CONFIDENTIAL.
(CAA894/45).
Sir,
GOVINIAT HOUSE,
Hong Kong.
26th June, 1946.
24
I have the honour to address you on the subject af the Crown leases which were granted during the last century for terms of seventy-five years with no provision as to removal.
2.
This matter was the subjost of mzerous despatches prior to the may occupation of the Oolony and it has assınd a new importance by reason of the wide-spread destruption of property, particularly residential property in the Hill District.
3.
The rehabilitation of residential property is a matter of great urgency and property-owners who hold under leases which have only a few years still to run have naturally expressed anxiety to be acquainted with the terms on which new Grown Lenses would be grated bofore they undertake the very heavy expenditure which rehabilitation will entail,
4
After discusion with the ecutive Council, I issued. an the 13th June, a press notification designed to soquaint the publio with the policy of the Government, A copy of this notifica- tim is enclosed.
5.
The majority of the termas embodied in the enclosure are 'common fœuf to the terms of grants made when there is a surrender of the outstanding portion of the text of an existing lease and the grant of a new lease, but certain innovations mentioned in the subsequent paragraphs of this despatch have been introduced to cover points on which there had been agreement before Deceber, 1941, ar which arise particularly out of the destruction due to operations ar to the activities of looters.
6.
It will be noted that paragraph ↳ (b) of the analosure implements the suggestion made in paragraphs 4 and 5 of Lord Hoyne's dospatah No. 37 of 17th Marah, 1941, in that it allows the Crown lesson to alect whether he should pay the renewal premium in a lup sm or by instalments spread over a number of years,
7.
If normal conditions had prevailed effeat might have been given to the proposal that the premium should be reduced in proportion to the good condition of the praises on the expiry of the term Unfortunately in very many cases the praises have been completely gutted and, with the present high cost of labour and materials, it is not unlikely that the cost of rehabilitating the shall of the building will frequently eased the ariginal cost of the building and my often amoeed the amount of any renewal perlum wideh might be payable.
8.
It appeared to me not inequitable that the Crown, as ground landlord, should share saet ing of its tenant's burden, but above all, I falt that there was little prospect that leaseholders would undertake the › rehabilitation which is so urgently necessary if they found themselves called upon to pay the full premium in addition to the abnormal cost of rebuilding. In these circustan es I indicated in paragraph 6 of the nalosure that applications would be entertained for the remission of the prudur. which would otherwise have been payable to the extent of ane-half of the necessary cost
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