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1. Hong Kong Land seeks return to residential development

2. Cartoon

3. Technology park to boost SAR's role in delta

4. SHKP sees a future building townships

5. Commuters drive up Shenzhen house prices

6. Anson Chan provokes outcry after her latest veiled attack

7. Lost lamppost shed light on outlawed building

8. Thousands of village homes may be illegal

9. Fuel recycling plant opens in trial scheme

10. $100m for green projects in limbo

1. Hong Kong Land seeks return to residential development
Sophia Wong, SCMP 30 December 2002

Jardine Group property flagship Hongkong Land plans to re-enter the SAR residential market after playing almost no role during the past 20 years.

Having stood on the sidelines of the housing boom in the 1980s and 1990s, Hongkong Land is looking to build a portfolio of high-quality projects in the coming five years, director of residential development Tony Tse Wai-chuen said.

Hongkong Land, the largest grade A office landlord in central, was hunting for prime residential sites and saw good medium-term profit returns from the sector, he said.

"It is a good chance to enhance our strength during a market slump."

The group had received three proposals for high-end residential projects in the past three months but no concrete deals had been struck, he said.

It has committed to a redevelopment of Lai Sing Court in Tai Hang - a project that was complicated by the need to offer former tenants termination compensation of HK$400,000 and owners a new flat in the 320-unit twin tower development.

"we will not cut the budget for construction in order to achieve high building quality and establish a reputable brand name," he said.

Hongkong Land was formerly a major developer of high-end properties, but in the 1980s, it sold its portfolio Mid-levels, Island south and peak properties, choosing instead to focus on office development.

Its last residential project was Tregunter (Block one and two), completed more than 20 years ago.

Mr. Tse said office leasing would remain the firm's core business and residential units would be sold rather than held for investmenet purposes.

"We are planning to expand our residential portfolio in major South-east Asian cities and we have earmarked Hong Kong and Beijing after detailed studies."

Hongkong Land began a US$300 million joint-venture residential development, Central Park, in the Chao-yang business district in Beijing in 2000.

The firm was also undertaking two staff-quarter redevelopments in Western District to provide 185,000 sq ft residential floor area for the mass market, Mr Tse said. It is also holding a 1.1 million sq ft agricultural site in Yuen Long, together with Sun Hung kai Properties.

As a senior vice-president of Hong Kong Insitute of Surveyors, he said: "Personally, I am pessimistic in the short term, but in the medium term, the market can recover."

2. Cartoon
SCMP 30 December 2002

3. Technology park to boost SAR's role in delta
Leu Siew Ying in Nansha, SCMP 30 December 2002

Guangzhou, HKUST and the Fok Foundation team up in Nansha. A technology park was launched yesterday amid the paddy fields and banana groves of Guangzhou's southern Nansha island, amed at strengthening Hong Kong's position in the Pearl River Delta.

Invited dignitaries, and about 100 peasants, watched the ribbon-cutting and lion-dancing ceremony that marked the completion of the first phase of Nansha Information Technology Park - a joint venture between the Hong Kong University of Science and Technology (HKUST), the Fok Yin Tung Foundation and the Guangzhou government.

Borrowing a slogan made popular at the 16th Communist Party Congress, Henry Fok Yin-tung told guests at the ceremony: "Economic development has to progress with time."

The park is an integral part of Mr Fok's decade-long efforts to develop the island. His non-profit foundation has invest $2.5 billion in Nansha, most of it in high-quality, but little used, recreational facilities. He plans to commit a further $1.3 billion.

The island has emerged from relative obscurity to become no les than the linchpin in Guangzhou's development plans for the coming 10 years.

Guangzhou vice-Mayor Zhang Guangning said his city could use the park and the Fok Foundation to develop at the same pace as Hong Kong and Macau. The province hopes that the equivalent of Shanghai's Pudong New Area will be created on Nansha.

Lionel Ni, head of HKUST's computer science departmenet, said the SAR could no longer act as China's gateway.

"High technology can play an important role because China is still very backward in this respect," Professor Ni said. "Hong Kong is in a unique position to play this role because of its legal system, its financial system and its openness."

HKUST will be looking into the technological development of businesses in the Pearl River Delta, according to Otto Lin, the univeristy's research and development Vice-President. "A lot of these businesses are owned by people in Hong Kong. By helping the Pearl river Delta, we are helping Hong Kong," he said.

Liu Binyuan of Guangzhou's South China University of Technology said that the venture would allow Guangdong to tap Hong Kong's access to international markets and IT expertise.

Hong Kong would benefit even more because of the park's strategic location a the geographic centre of the Pearl River Delta area, Professor Liu said.

"There may be other IT parks in Guangdon but Nansha is nearest to Hong Kong.

4. SHKP sees a future building townships
Sophia Wong, SCMP 30 December 2002

Fancy clubhouse just will not do anymore, as home buyers begin to demand a more comprehensive living environment.

Hong Kong's biggest developer, Sun Hung Kai Properties (SHKP), aims to transform itself from a builder of housing estates into a "facilitator" of integrated town- ships.

The firm was reacting to market demand for more comprehensive living environments and well-developed neighbourhoods, Sun Hung Kai Real Estate Agency sales general manager Eric Chow Kwok-yin said.

Hong Kong developers generally rely on podium-based high- rise projects which may include fancy clubhouses but otherwise offer few community facilities.

Mr Chow said the 2,224 units at SHKP's YoHoTown, in Yuen Long, due for completion in 2004, represented a new approach.

"The pre-sale consent has al- ready been issued but the layout design is being revised," he said. "The first phase for sale next year provides 1,000 two-bedroom units. me of them include green features."

YoHoTown, with a gross floor area of 1.18 million sq ft, is near the Yuen Long Station on the West Railway due to open this year.

Reacting to changed buyer tastes, the firm has reduced the average unit size to 530 sq ft from 828 sq ft.

Market Driven

- The developer says it is reacting to market changes.
- it will need to buy huge blocks of land, such as those available mainly in rural areas.
- Meanwhile, it expects to see market demand rise next year.

The project can be connected with another larger scale development in Yuen Long Town (Lot 504), comprising a 1.45 million sq ft residential area and 249,000

Sq ft of retail space, also due to the completed by 2004.

"A large-scale estate, like a town development, enables higher flexibility in planning. Only huge sites, mainly in the rural areas, will be spacious enough to include comprehensive community infrastructure," Mr Chow said.

He said SHKP was aiming to acquire giant sites for township developments.

In the coming year it would release 6,000 residential units for sales and hoped to secure sales revenue of HK$15 billion, he said. The target compared with the 5,700 units sold this year.

Apart from YoHoTown, SHKP and Cheung Kong (Holdings) have a 40:60 joint venture - Vianni Cove in Tin Shui Wai, Yuen Long - available for pre-sale next year. Its 1,091 units are due to be completed in December next year.

The first project for sale next year could be Shum Wan Tower, a mixed development of private and subsidized housing in Aberdeen. Its 1,040 units were to be finish by April 2004.

"We are now discussing with the government about the settlement of the units formerly planned for subsidized housing. The show flats are complete and the project can be released for sale in the coming two to three months," he said.

Other project for sale in the coming two to three moths," he said.

Other projects for sale include 1 Ho Man Tin Hill Road, 18 Farm Road and a joint venture with Cheung Kong in West Kowloon.

Mr. Chow expected last month's market stimulus measures to feed into improved sentiment by the middle of next year and for the full year predicted total sales of new properties to rise 5 per cent, with prices to remain stable.

SHKP had no plan to slash prices to compete with rival projects.

5. Commuters drive up Shenzhen house prices
Bloomberg in Shenzhen, SCMP 30 December 2002

With the border open 24 hours a day, demand for the inexpensive flats could grow. Shenzhen home prices doubled in the past decade and may keep rising as the commute between Hong Kong and its closest mainland neighbour gets faster and easier.

Bank of East Asia and other Hong Kong banks have increased mortgage lending in Shenzhen where Hutchison Whampoa is among the several developers budding more homes.

They are betting on growing demand from Hong Kong, where property prices remain twice those of Shenzhen even after a five-year slump has slashed SAR home values by 60 per cent.

The sweetener is that one of two border crossings between Hong Kong and Shenzhen will be opened 24 hours a day, starting on January 27, for the thousands of people who make the daily commute.

DTZ Debenham Tie Leung re- search director Alva To said: "Shenzhen is the obvious choice because it takes less than an hour from the city centre to get across the border.

"Home prices are so much cheaper, and the cost of living is much lower too."

Colliers International said homes in Yuen Long, near the Lok Ma Chau border crossing which will be operated around the clock, cost about HK$1,500 a square foot, compared with 745 yuan (about HK$701.1) for similar properties in Shenzhen.

Bank of East Asia and other Hong Kong lenders offer incentive packages to city residents buying property on the mainland, aiming to offset slumping mort- gage business at home, where about 70,000 homeowners are in negative equity - owing more than their properties are worth. An estimated 300,000 Hong Kong residents live in Shenzhen, which has a population of about four million.

Hong Kong bank lending to investors buying mainland homes almost tripled in 'September to HK$333 million.

Outstanding loans taken out on mainland properties amounted to HK$6.2 billion at the end of September, the Hong Kong Monetary Authority said.

That compared with HK$535.3 billion outstanding on Hong Kong mortgages.

Bank of East Asia China property-landing department head Wendy Wong said: "We are seeing a rebound in the cycle of Hong Kong people buying properties in China in the past two years after property prices in the mainland slumped during the Asian financial crisis in 1997-98."
The bank began its mainland home-loan business in 1988.

Hong Kong developers also are hunting for growth across the border.

Seven, development companies in the Hang Seng Property Index collectively reported net income fell 40 per cent to HK$21.8 billion in their most recent financial years, as they wrote down the value of their property holdings.

in, the third quarter, China Overseas Land & Investment, China Vanke, Hutchison Whampoa and other developers were offering about 33,000 homes in Shenzhen.

Tycoon 11 Ka-shing's Hutchison Whampoa is developing five million sq ft of residential space at its Le Parc project in Shenzhen's futian district, across from Lok Ma Chau and the busier Lo Wu border posts.

China Overseas Land, the mainland Construction Ministry's Hong Kong property arm, is building 1.4 million sq ft of homes at its Shenzhen Bay Garden in the Nanshan district, to the east of Futian.

Sun Hung Kai Properties, New World Development and Henderson Land Development are among developers holding the most land in Hong Kong's outer suburbs.

They may need to slow the pace of their developments and cut prices to compete, analysts said.

Henderson Land, Hong Kong's second-biggest developer by sales, has about 279,000 square metres of housing for sale in Yuen Long and other parts of the New Territories. Shares in Henderson Land have declined 8 per cent since the announcement on December 11 of the 24-hour border crossing facility.

Shares in Sun Hung Kai Properties, Hong Kong's biggest developer, have fallen about 6 per cent since the announcement.

The company offered cash re-bates of as much as 20 per cent on mortgages to home buyers at its New Territories projects, including the Aegean Coast complex, in Tuen Mun, and park Central along the new Tseung Kwan O subway line.

Border benefit

- Hong Kong banks increase mortgage lending in Shenzhen
- The opening of a 24-hour border crossing will draw more commuters to the city.
- Home price are cheaper and the cost of living is lower.

6. Anson Chan provokes outcry after her latest veiled attack
Jimmy Cheung, SCMP 30 December 2002

Former chief secretary Anson Chan Fan On-sang has provoked an angry reaction after saying some people "confuse black and white" when addressing issues affecting the SAR.

Her comments on Saturday to an audience of young people at an RTHK function were interpreted as an attack against Secretary for Security Regina Ip Lau Suk-yee and other pro-Beijing figures over the controversy surrounding proposed anti-subversion laws.

Mrs Chan also urged the yoursters to follow their conscience in deciding what is right and wround and to be brave enough to voice dissent. "If you find it is wrong, you should speak up, the issue grows."

Ma Lik, a local deputy of the National people's Congress, admitted the Article 23 debate had provokes extreme views.

"But I think Mrs Chan owes the public an explanation why she often breaks with tradition to comment on public politics or the government's performance."

He also challenged her to name those with whom she was dissatisfied.

"People must wonder why she is so keen to keep her political influence. I don't think she will do any good if she keeps making such provocative remarks."

A pro-Beijing politician, who refused to be named, believed Mrs Chan was referring to remarks by Maria Tam Wai-chu and Raymond Wu Wai-yung, both members of Beijing-appointed basic Law Committee.

Ms Tam has said people do not deserve to be Chinese if they fail to support the national security law, while Dr Wu has threatened to ask Beijing to reinterpret the Basic Law if the government does not press ahead with a blue bill to legislators.

But political commentator Ivan Choy Chi-keung, a lecturer at City Unviersity, questioned if Mrs Chan's comment were directed against op officials.

"based on the concerns voiced by Mrs Chan recently, I wonder if she is talking about Mrs Ip."

He said Mrs Chan was clearly eager to maintain her role as the conscience of Hong Kong.

7. Lost lamppost shed light on outlawed building
Cheung Chi-fai, SCMP 30 December 2002

The disappearance of a lamppost alerted the lands Department' the fact that a six-storey house had been built on government land at Lam Hau Tsuen in Yuen Long.

For the past few months, construction of the building has gone unnoticed by the authorities, even though it is the tallest and largest in the 200-year-old village. The house is so big that it can accommodate at least six families in a total floor area of 10,000 square feet. The house is four times larger than three-storey village houses nearby.

Officials only became aware of the problem recently after CLP Power complained in October that it had lost a lamppost there.

The Lands Department had is- sued repeated warnings to the owners and contractors of the building but they were all ignored. The construction work continued and was stepped up. The department and police finally sealed the property off two weeks ago.

The operation triggered an angry response from Cheung Kwai- yau, an indigenous resident of the village who claimed ownership of. The newly built house. He became emotional when police arrived at the house and only calmed down after being warned repeatedly by officers.
"This is our land on which our ancestors' houses were built and it is my mother's wish to build this house as shelter for the next generations," he said. Mr Cheung said his family had paid $3 million to build the house.

But all proof of ownership has gone missing. Lai Nin-shing, a land officer in charge of the operation, said the land was owned by the government, according to their records.

However, Mr Cheung insisted that they had every right to redevelop the site without the need for approval.

"Don't you know who, indigenous residents are?" he said. "We fought as guerillas during the war against the Japanese. Our uncles all studied here decades ago. How dare you to say it is government land?

"Everybody in the village is doing the same here and there are no problems. Even the rural committee says we don't have to get approval for the house," Mr' Cheung said.

8. Thousands of village homes may be illegal
Cheung Chi-fai, SCMP 30 December 2002

Developers have taken advantage of lax enforcement of regulations to build on government land without approval.

Thousands of village houses have probably been built illegally on government land in the New Territories and the problem has gone unnoticed by the authorities for years.

Critics say the situation could lead to land disputes and confrontations between the administration and villagers when the authorities resume the land.

Villagers and developers have taken advantage of inadequate enforcement measures, with officials being forced to tolerate the problem due to limited resources.

The government discovered the extent of the situation during a clearance operation this month when it emerged that about one- third of the 200 houses at Lam Hau Tsuen in Yuen Long had been built illegally on government land.

There are about 800 villages in the New Territories. Officials privately estimate that thousands of village houses could have been built without approval from the Lands Department and the Buildings Department.

It is also understood that some private developers have turned government land into gardens at low-rise residential projects in Yuen Long and Sheung Shui.

Under the Limitation Ordinance, government land occupied illegally for 60 years can be turned into private sites.

This means the administration could face a big loss in land revenue if the situation is not reversed.

But land officers have been frustrated by the lack of resources to address the growing problem.

There are only two to three officers tackling the illegal housing problem in each of the nine New Territories districts.

A principal lands executive at the Lands Department, Luk Cheung-chuen, said there could be thousands of illegal village houses in the New Territories.

"We have been working hard to squeeze resources to do our job but it is simply not enough. The staff are frustrated and we are not happy with the situation," he said.

Mr Luk said that even with more staff, it could take at least five years to clear all the illegal homes in the rural areas. He also said there was the potential for confrontation with villagers.

The Yuen Long District lands officer, Chris Mills, said it was impossible to estimate the scale of the problem'

Mr Mills said they could only take action when they received complaints.

Lam Kwok-cheong, an executive committee member of the Heung Yee Kuk, which represents indigenous residents' interests, said the government should carry out a survey to assess the serious- ness of the situation.

He said the administration's poor land record was at the root of the problem.

Charles Lai Chin-pang, man- aging director of Surpass Property Consultant, which specialises in village houses, said the government should have carried out its duties as the biggest landowner in Hong Kong and managed its land properly.

"It obviously reflects a neglect of duties on the part of the Lands Department," he said.

9. Fuel recycling plant opens in trial scheme
Susan Schwartz,SCMP 30 December 2002

A test project to produce 100,000 litres of fuel from used waste oils began yesterday with the opening of a $500,000 recycling plant - one of Hong Kong's biggest - in Yuen Long.

The trial, organised by non- profit group Better Environment Hong Kong, is planned to last a year. If adopted by the government, fuel from the plant would cost about 60 cents a litre, for processing costs, the group's spokesman, Steve Choi, said.

He said the plant would process 105,000 litres of waste oil, which would come from utility companies and ship, vehicle and freight sectors.

The recycled fuel will be tested by Kowloon Motor Bus, utility, firms and cross-border vehicles.

"The bottom line is that the government has to make a commitment to the environment," Mr Choi said. "It's a proven techno- logy elsewhere, why not Hong .Kong?

"The government already spends $500 million a year incinerating waste oil. And they use tens of millions of litres of imported diesel fuel each year but are not prepared to buy locally-produced, recycled diesel fuel. [The] oil ... is highly price-competitive and has the added advantage of improving air quality by cutting down on vehicle emissions."

Steve Lord, technical director of Brighter Limited - the company that built the plant - said a bigger plant would cost up to $2.75 million and could produce 18 million litres a year. "The used oils or fuels are refined through the distillation and cracking process which breaks down hydrocarbon oils. This technology will give us the ability to responsibly handle liquid and used oil waste and turn it into clean oil."

10. $100m for green projects in limbo
Heike Phillips, SCMP 30 December 2002

A $100 million fund, earmarked for community projects targeting sustainable development, has been locked up for more than three years because of the government's failure to form a council to oversee its use.

Top officials have said it would be set up soon, possibly early in the new year, but so far key green groups and even some government units have been told nothing about it.

The fund is linked to the Council for Sustainable Development (CSD) - a body announced by Chief Executive Tung Chee-hwa in his 1999 policy address that has yet to be established.

The council is envisaged as an adviser to the government on forming a blueprint for economic, social and environmental development.

In October, Chief Secretary Donald Tsang Yam-kuen indicated the council would be established soon and that the government remained committed to establishing such a forum under the accountability system.

Mr Tsang made the statement in the Legislative Council during a motion debate on sustainable development on October 23.

Two months later, neither the Sustainable Development Unit (SDU) - set up to assist the CSD - nor green groups or development agencies -have received confirmation on exactly when the council will be established.

The SDU's assistant director of administration, Jonathan McKinley, said an announcement could be made early in the new year., But he added that its establishment should not be rushed.

"It's very important. to make sure the council's work is clearly defined as distinct from the Advisory Council on the Environment and the chief executive's Council on Strategic Development," Mr McKinley said.

"We don't want to be seen as having just another council. It has to be something recognisable, with recognisable aims and out- comes for the public as well as its members."

The $100 million fund remains inaccessible to community groups until the council is established with clearly defined fund- ing guidelines and an audit system.

The CSD will involve members from the business, private, non- government, academic and government sectors. Its collective task will be to provide expert ad- vice to the government and to foster community. awareness and participation in sustainable development.

"Membership of the council will ultimately be decided by the chief executive, but members should be receptive and engaged," Mr McKinley said.

'A promising first step towards drawing up a blueprint for the sustainable development of Hong Kong was made with the so-called SUSDEV21 study in 1999, which led to the establishment of the Sustainable Development Unit.

The unit was set up in April last year and has been waiting for the arrival of its "taskmaster" ever since.

Chandran Nair, chief executive officer of ERM Asia Pacific and director of the SUSDEV21 study, cautions community groups not to overestimate the influence the council will have on shaping policy.

"Ultimately the role of the council will be to form a bridge between the policy-making arms of government and the public," Mr Nair said.

"Non-governmental organisations have a great role to play, but they must get their strategy of engagement right."