V. Demand-led Redevelopment Project (Pilot Scheme)

The Urban Renewal Strategy, which was promulgated on 24th February 2011, providesthat the URA may respond to a joint approach frombuilding owners to initiate redevelopment of their lot(s) or building(s). The URA hastherefore introduced an owner-initiated, demand-led redevelopment scheme tofacilitate urban renewal.

A. Principles of the Pilot Scheme

Just as with URA-initiated redevelopment projects, demand-led redevelopment projects are implemented under the Urban Renewal Authority Ordinance ( Cap.563 of the Laws of Hong Kong) (the “URAO”).

The Pilot Scheme covers only development projects which may be implemented under Section 26 of the URAO , so amendments to the Outline Zoning Plan are not required.

The prevailing principles adopted by the URA in the acquisition of properties will be applicable to the demand-led redevelopment projects implemented subsequent to the Pilot Scheme.

The prevailing principles adopted by the URA for the provision of re-housing and ex-gratia payments will be applicable to any demand-led redevelopment projects implemented subsequent to the Pilot Scheme.

B. Application requirements

The application must meet the following criteria:

    1. It should be a joint application by the owners of not less than 67% of the undivided shares in each lot within the Site.
    2. Residential building conditions within the site should be “poor” or “varied”.
    3. The site should generally be larger than 400 square meters. If a smaller site is proposed, there must be special needs to support the URA to consider it.
    4. The site does not comprise buildings/structures of historical, architectural or cultural significance unless they can be integrated into the future development.
    5. The site is situated within redevelopment zones and not situated within any of the proposed preservation areas identified by the District Urban Renewal Forum, if there are any in the district in which the site is located.

C. Selection

The URA will consider allapplications which fulfill the selection criteria. All applications will be assessed with reference to the following factors:

Residential building conditions

For example:

    1. A high proportion of the residential buildings in poor condition, indicated by building decay and dilapidation, such as concrete spalling, cracking, bulging, leakage or seepage;
    2. A high proportions of the residential buildings with confirmed signs of sub-divided units;or
    3. Residential buildings with permanently obstructed means of escape from the ground floor to the roof.

Planning gains

For example:

    1. The redevelopment allows for set-back/road widening, etc. (ifthe Government’s intentions are known) or has the potential for this;
    2. The redevelopment allows for pavement widening/corner set-back /realignment of a public passageway;
    3. The redevelopment allows for better vista and air-ventilation;
    4. The redevelopment allows for the provision of at-grade open space, or space for social enterprise or GIC use;
    5. Buildings/structures within the proposed project are of historical, architectural or cultural significance, and are deemed to be able to add value to the future development by providing a viable”theme”;
    6. The redevelopment allows for designs to mitigate current noise impact;
    7. Existing use includes obnoxious trades, or unauthorized or illegal activities, the removal of which by way of redevelopment would have a positive impact on local living environment;or
    8. Poor living conditions: e.g. a high degree of sharing (if discernible).

Planning impact

For example:

    1. Redevelopment of the proposed site would compromise the potential of implementing a more comprehensive project for the benefit of the community;
    2. Existing use (with a distinct local character) would be removed by redevelopment; or
    3. Over-concentration of projects in that district in the same year.

Other planning factors

For example:

    1. A clear indication of local aspirations;
    2. Ownership structure;
    3. Re-housing resources in the district; or
    4. Abnormal spate of tenant evictions.

If there is/are suitable demand-led redevelopment project(s) that satisfy all the application requirements, the URA may exercise its absolute discretion, while considering whether the URA has sufficient resources to undertake any such demand-led redevelopment projects within a reasonable period.

Demand-led redevelopment projects selected by the URA have to be approved by the Financial Secretary for implementation.

The URA conducts a freezing survey for the building(s) within the site of an approved project for commencement. This indicates that the relevant application has been approved and that the relevant project has commenced.

D. Implementation

Implementation of the approved projects is subject to the fulfillment of the following two conditions precedent:

    1. Acceptance of URA’s conditional offers and the signing of Sale and Purchase Agreements by the owners of not less than 80% of the undivided shares of the lots in the site under application within a period of not more than 90 days of the issue of the URA’s conditional offers; and
    2. Within one year of the issue of the URA’s conditional offers, the granting of authorization by the Secretary for Development for the URA to implement a development project under Section 24 of the URAO for the site under application, with no appeals received upon the expiry of the appeal period, or the dismissal of all appeal(s), if any.

If the above conditions precedent have been fulfilled, the URA notifies the owners in writing to complete the relevant Sale and Purchase Agreement within one month after the date of fulfillment of all conditions.

If any of the two conditions precedent above cannot be met, the URA will not proceed any further with the approved project and will cancel any Sale and Purchase Agreements already signed with any owners.