hkskyline
March 16th, 2006, 06:00 AM
Developers cashing in on eco-buildings
The environmental policy is being exploited and a review is needed, say lawmakers and a green group
13 March 2006
South China Morning Post
The government policy to promote eco-buildings has enabled developers to add floor space worth hundreds of millions of dollars to their projects by paying land premiums amounting to a tiny fraction of the space's value.
Inquiries by the South China Morning Post on four new estates found the developers had obtained between 3 and 13.8 per cent additional floor space by adding "green" features that attract minimal or no premiums.
Lawmakers and a green group said the policy was being exploited and should be reviewed.
The Buildings Department said a survey would be carried out this year on whether the policy, set in 2001 and 2002, should be maintained.
The four projects are The Arch in West Kowloon, The Orchards in Kornhill, Metro Harbourview in Tai Kok Tsui and Grand Promenade in Sai Wan Ho.
In the case of The Orchards, developer Swire Properties gained 5,089 square metres in floor space for balconies, larger lobbies and corridors, sunshades, a sky garden and non-structural prefabricated external walls.
The company paid a land premium of $2.37 million, but the space is now worth $366 million based on the average price of $6,700 per sq ft.
Sun Hung Kai Properties gained 3 per cent extra space after paying $9.7 million for eco-friendly facilities at The Arch. The extra space, measuring 3,067 square metres, is now worth $339 million.
Henderson Land paid $10 million for green features in the Metro Harbourview, but the 4,896 square metres is now worth $226.5 million.
The company did not pay any premium for the features at Grand Promenade because no maximum floor area was set for the site, even though the extra 12,143 square metres is now valued at $783 million.
Democratic Party chairman Lee Wing-tat said the policy allowed developers to reap huge profits.
"The policy is aimed at improving the environment rather than allowing developers to make further profits. It is unbelievable that the premium amount could be so cheap," he said. "The buildings' values are already enhanced by the green features.
"Developers gained an advantage by exemption of these features from the permitted gross floor area. And now they have earned double benefits by selling these features to consumers. The director of audit should look into the matter."
Ng Cho-nam, of the Conservancy Association, said the green features were not worth such huge amounts.
"The developers are now trying to maximise their profit margins in the name of environmental protection," he said. "Not every building in Hong Kong needs a balcony."
Post inquiries found a total of 288 residential projects had adopted the new policy on green features, with 91 per cent adding balconies, 65 per cent providing utility platforms, and 44 per cent including large lobbies and wide corridors.
Buildings Department chief building surveyor Hui Siu-wai said the department would seek users' and developers' views on the policy's effectiveness.
"We will see if we need to add new features to the policy," he said.
Developers were required to state the size of these features in sales brochures, he said. "But no one knows how much the consumers pay for these green features. It is a very complicated calculation."
Consumer Council chief executive Pamela Chan Wong-shui said green features were welcome because they were good for the environment.
But she said buyers should look at the official saleable area of a flat, which excluded these green features and other public facilities, rather than gross floor area, commonly used by buyers and developers.
The environmental policy is being exploited and a review is needed, say lawmakers and a green group
13 March 2006
South China Morning Post
The government policy to promote eco-buildings has enabled developers to add floor space worth hundreds of millions of dollars to their projects by paying land premiums amounting to a tiny fraction of the space's value.
Inquiries by the South China Morning Post on four new estates found the developers had obtained between 3 and 13.8 per cent additional floor space by adding "green" features that attract minimal or no premiums.
Lawmakers and a green group said the policy was being exploited and should be reviewed.
The Buildings Department said a survey would be carried out this year on whether the policy, set in 2001 and 2002, should be maintained.
The four projects are The Arch in West Kowloon, The Orchards in Kornhill, Metro Harbourview in Tai Kok Tsui and Grand Promenade in Sai Wan Ho.
In the case of The Orchards, developer Swire Properties gained 5,089 square metres in floor space for balconies, larger lobbies and corridors, sunshades, a sky garden and non-structural prefabricated external walls.
The company paid a land premium of $2.37 million, but the space is now worth $366 million based on the average price of $6,700 per sq ft.
Sun Hung Kai Properties gained 3 per cent extra space after paying $9.7 million for eco-friendly facilities at The Arch. The extra space, measuring 3,067 square metres, is now worth $339 million.
Henderson Land paid $10 million for green features in the Metro Harbourview, but the 4,896 square metres is now worth $226.5 million.
The company did not pay any premium for the features at Grand Promenade because no maximum floor area was set for the site, even though the extra 12,143 square metres is now valued at $783 million.
Democratic Party chairman Lee Wing-tat said the policy allowed developers to reap huge profits.
"The policy is aimed at improving the environment rather than allowing developers to make further profits. It is unbelievable that the premium amount could be so cheap," he said. "The buildings' values are already enhanced by the green features.
"Developers gained an advantage by exemption of these features from the permitted gross floor area. And now they have earned double benefits by selling these features to consumers. The director of audit should look into the matter."
Ng Cho-nam, of the Conservancy Association, said the green features were not worth such huge amounts.
"The developers are now trying to maximise their profit margins in the name of environmental protection," he said. "Not every building in Hong Kong needs a balcony."
Post inquiries found a total of 288 residential projects had adopted the new policy on green features, with 91 per cent adding balconies, 65 per cent providing utility platforms, and 44 per cent including large lobbies and wide corridors.
Buildings Department chief building surveyor Hui Siu-wai said the department would seek users' and developers' views on the policy's effectiveness.
"We will see if we need to add new features to the policy," he said.
Developers were required to state the size of these features in sales brochures, he said. "But no one knows how much the consumers pay for these green features. It is a very complicated calculation."
Consumer Council chief executive Pamela Chan Wong-shui said green features were welcome because they were good for the environment.
But she said buyers should look at the official saleable area of a flat, which excluded these green features and other public facilities, rather than gross floor area, commonly used by buyers and developers.