TNAG-0961-FCO40-1180-Legislation-for-piers-and-harbours-in-Hong-Kong-1980 — Page 3

G.S. 84

XCR(80)64

(b)

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(e)

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case of piers granted as an extension to and for a term co terminous with the parent lot. The piers to be regranted were originally granted on separate pier leases for a definite term of 15 years (renewable for a further 15 years) without regard to the existence of a parent lot. Some of the piers are directly accessible from Crown land, others only through privately leased land. In either case, application of the pier lease formula would produce a distorted rental since the formula must take account of the user of the parent lot which for the present purposes would have to be deemed to be the user of the piece of land immediately adjacent to the piers;

comparison with tendered rentals for industrial sites with marine access let on short term tenancy under the abbreviated tender system is not valid since no sites for this purpose have been tendered in the Tsim Sha Tsui or Yau Ma Tei Districts for many years;

adjoining industrial ground floor accommodation values do not provide a true comparison since piers are not covered over and are more akin to an open storage and working area than to permanent factory space;

the majority of the piers are not separately rated and the assessments of those that are date back to 1977; and

apart from ferry piers, Government piers are not rented out to private companies, thus no current rental values for piers are available;

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Having concluded (as was the case in 1964), that a strict valuation approach is not practicable, the Director of Lands, Survey and Town Flanning has recommended that assessment of annual rentals should be based on the increase in industrial land prices since 1964. This approximately twelvefold increase gives a rounded off average annual rental of $150/m2.

Objections to the Proposed Annual Rental

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The Director of Trade, Industry and Customs accepts that a rent increase is warranted but considers that the proposed uniform annual rent of $150/m2, in addition to being excessive, is also inequitable. Under the existing leases, the annual rent ranges from $9.67/m2 (TWPP8) to $13.49/m2 (KPP78) and he has noted that the introduction of a flat rate of $150/m2 would result in an increase of 15. 5 times in case of the former but only 11. 1 times in the case of the latter. He is of the view that it is

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