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LCQ7: Land sale programme

     Following is a question by the Hon Tony Tse Wai-chuen and a written reply by the Secretary for Development, Mr Paul Chan, in the Legislative Council today (April 17):


     Some professionals have relayed to me that in recent years, the Government has sold land more and more often by tender. However, the tendering procedure lacks transparency.  For example, the Government announces the tender results and details of the successful bids only, and it will not make public the numbers of qualified and unqualified bids received, the highest and lowest bidding prices, or the reasons why other bids are unsuccessful, etc.  In this connection, will the Government inform this Council:

(a) of the respective numbers of sites sold by the Government through auction and tender in each of the past five years; whether relatively fewer sites were sold by auction; if so, of the reasons for that; the criteria based on which the Government decides on the means of land sale to be adopted;

(b) whether the Government will comprehensively review and enhance the current procedure for the sale of land by tender, so as to increase its transparency; if it will, of the details of the review and the implementation timetable; if not, the reasons for that and whether it will conduct such a review in future;

(c) whether the Government will sell land, particularly the residential sites, more often by auction in future; if it will, of the details; if not, the reasons for that; and

(d) whether the Government will draw up and announce a land sale programme covering a longer period (e.g. three to five years) to replace the current practice of announcing the land sale programme on a quarterly basis, so as to enable the market and members of the public to better grasp the situation of future supply of land and property units; if it will, of the details; if not, the reasons for that?



     My reply to parts (a) to (d) of the question is set out below:
(a) and (c) The number of sites (including those for residential, non-residential and other special purposes such as petro-filling stations, etc.) sold by the Government through auction or tender in the past five financial years (Note) is tabulated below:

Financial    Number of      Number of    Total
Year         sites sold     sites sold
             by auction     by tender    
---------    ----------     ----------   -----
2008-09           1              2           3
2009-10           4              6          10
2010-11          10              7          17
2011-12          10             29          39
2012-13           0             28          28
             ----------     ----------   -----
Total            25             72          97

Note: Based on the date of auction/tender award.

     Public tender and auction are two land sale means that the Government has been adopting all along. They have different operational details, but both are fair, just and competitive means of land sale.  In recent years, the Government has sold sites by adopting the tender means more often, the main consideration being that under the tendering situation, the bidders can submit bids calmly having regard to their development plans and assessment of the market.

(b) The Government reviews the land sale procedures from time to time with a view to maintaining adequate market transparency.  

     Before invitation of tender for individual sites, the Lands Department (LandsD) normally issues press release one month before invitation date, giving important parameters on site area, gross floor area, etc. Whenever possible, LandsD uploads draft land sale conditions before tender invitation. These draft land sale conditions are usually not much different from their finalised version released upon tender invitation.  For cases where draft land sale conditions have not been uploaded much earlier, LandsD may consider slightly lengthening the tender period of individual sites on a need basis. Hence, interested bidders have been able to make the necessary preparations.

     As for land sale through the tender means (determined based on the bidding price), the information on the tendering result announced by LandsD includes the name of the successful bidder and its bidding price, as well as the names and number of other bidders. Since March 2013, LandsD has also announced the names of the parent companies of the bidders if shown in the tendering documents submitted.  

     The above measures have provided the market with the needed transparency.

(d) To expand and supply land is ongoing work. The Government will continue to work hard to increase land supply by adopting a multi-pronged approach, and expedite the allocation of new land for various suitable uses, including the development of subsidised housing or supply to the market for private development.  When government sites are ready for private development, they will be included in the annual Land Sale Programme.  As the information on the sites intended to be supplied for land sale is commercially sensitive that could impact on the property market, the Government needs to act prudently and consider carefully the impact of announcing any land information.  Specifically, there is inevitably less certainty in the information for a longer period, and sites may involve different studies and preparatory work before they are available for sale.  Possibilities are that such information, if released prematurely, could send wrong signals to the market.  We have no plan to change the current arrangements for announcing the annual Land Sale Programme on a yearly basis and the sites to be put up for sale on a quarterly basis.  The existing arrangements can provide transparency for the market, while preserving the Government's flexibility to respond to market situations and demand.

Ends/Wednesday, April 17, 2013
Issued at HKT 14:30


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