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LCQ6: Application for waiver of government lease conditions for car parks of The Link
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     Following is a question by the Hon Lee Wing-tat on behalf of the Hon Fred Li and a reply by the Secretary for Transport and Housing, Ms Eva Cheng, in the Legislative Council today (December 2):

Question:

     Some of the car parks under The Link Management Ltd ("The Link") have been granted waiver of government lease conditions by the Lands Department to lease some of the monthly parking spaces in these car parks to non-residents of the relevant housing estates ("non-residents"). It has been disclosed earlier that The Link has not applied for renewal upon the expiry of the waivers concerned, but has continued to lease these parking spaces to non-residents. In this connection, will the Government inform this Council:

(a) of the car parks with monthly parking spaces leased to non-residents when The Link Real Estate Investment Trust was listed at the end of 2005, together with a breakdown of the number of such parking spaces by car park as well as the expiry dates of the various waivers; the car parks the waivers of which had expired and The Link had applied for their renewal and, among such applications, which ones have been approved and the annual waiver fees payable;

(b) of the car parks with monthly parking spaces currently leased to non-residents, together with a breakdown of the number of such parking spaces by car park, as well as the amount of waiver fees which have not yet been settled by The Link; and

(c) given that some non-residents have pointed out that when they rent the parking spaces, staff of the car park management companies had induced them to state that they are "residents" without asking them to submit any documentary proof, so as to pass on the liability to them, whether the authorities have looked into such situations; assessed whether the non-residents who falsely claimed to be residents, the management companies which allegedly have induced the non-residents to do so and The Link have committed an offence; what measures the authorities have put in place to regulate and prevent such activities?

Reply:

President,

     The demand by public rental housing (PRH) residents for parking spaces in some Hong Kong Housing Authority (HA) car parks was low. In order to make effective use of the parking spaces, before the listing of The Link Real Estate Investment Trust (The Link REIT) in November 2005, HA had applied to the Town Planning Board for planning permits and the Lands Department (Lands D) for waivers to lease these parking spaces to non-eligible persons other than the residents, occupiers and their bona fide guests and visitors (hereinafter collectively referred to as "non-residents"). After its listing, if The Link REIT wishes to lease its parking spaces to non-residents when the waivers are no longer effective, it has to apply to the Lands D for short-term waivers.

     With input from the Lands D, my reply to the three-part question is as follows:

(a) According to The Link REIT's Offering Circular for public listing, as at March 31, 2005 there were about 10% (or 5,000) non-residents among the more than 50,000 monthly tenants of the car parking facilities to be divested. Given the changing economic environment and The Link REIT's business considerations, there may have been changes to the 2005 figures I mentioned just now since the listing of The Link REIT.

     As advised by the Lands D, before the listing of The Link REIT at the end of 2005, 111 short-term waivers had been granted by the Lands D to the HA to lease parking spaces in the car parks concerned to non-residents. 82 of the waivers are no longer effective and 29 are still effective.

     The Link REIT has submitted applications for short-term waivers for 24 car parks, and eight of the applications have subsequently been withdrawn. Of the 16 applications, one has been rejected and 15 are being processed by the Lands D. It takes time to process the applications, including waiting for The Link REIT to obtain planning permits, studying the information provided, formulating the provisions in the waivers, and calculating the waiver fees to be paid if waivers are granted.  
 
(b) Since early September this year, the Lands D has discussed with The Link REIT the issue of leasing parking spaces to non-residents. The Lands D reiterated that if there was any violation of the user restriction on the car parks, the Government would take lease enforcement action and seek payment of the waiver fees.

     Subsequently, The Link REIT wrote to the Lands D on October 28 this year, offering to pay a sum of around $7.15 million as retrospective waiver fees for previously leasing the parking spaces to non-residents without valid waivers. Valuers of the Lands D are examining the details to determine whether the retrospective waiver fees proposed by The Link REIT are reasonable.  The Link REIT will be informed once there is a decision.

(c) The Lands D will require The Link REIT to provide details of the 15 applications I mentioned just now and to pay the waiver fees for the period of leasing the parking spaces to non-residents. The Link REIT has to ensure the information provided is accurate and to submit details of the rental income for the leasing period which are certified true by a certified public accountant. As regards car parks for which no applications for waiver have been submitted, The Link REIT has to ensure that they comply with all the lease conditions, including leasing the parking spaces to eligible persons only.

     If the Lands D finds that the information provided by The Link REIT is inaccurate or there is violation of lease conditions, it will seek legal advice and take appropriate follow-up action. The Lands D will not exclude the possibility of taking legal action when necessary.

Ends/Wednesday, December 2, 2009
Issued at HKT 15:24

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