The SAR government announced a long-term resettlement plan for owners affected by the fire at Wang Fuk Court, proposing to acquire the ownership of seven blocks through cash payments or a "flat-for-flat" scheme. Michael Wong, Deputy Financial Secretary and leader of the "Task Force on Emergency Accommodation Arrangements," along with Winnie Ho, Secretary for Housing, gave an interview to the Hong Kong Ta Kung Wen Wei Media Group yesterday (Feb. 22) to further elaborate on the plan's principles.
Wong noted that the plan balances legal, rational, and emotional considerations, prioritizing empathy by giving residents choices. The government has also included the approximately HK$4 billion required for the resettlement in the forthcoming Budget, confident that it is financially feasible. All owners must choose their preferred option by August 31 this year; otherwise, they will not be eligible for special arrangements.
The government plans to acquire the ownership of 1,736 units across seven blocks (Blocks A to G) of Wang Fuk Court. After utilizing approximately HK$2.8 billion from the "Support Fund for Wang Fuk Court in Tai Po," they still need an additional HK$4 billion in public funds.
Wong expressed disagreement with the view that "public funds are being used to cover the government's responsibility in the incident", emphasizing that the scale of the impact from the Wang Fuk Court fire is "unprecedented," rendering market mechanisms ineffective. If the government does not intervene, residents' years of investment could be lost.
"This is not compensation but support."
He further noted that addressing residents' needs promptly is a major consideration. Complicated legal procedures and lengthy processes will be undertaken by the government, and owners can finalize their long-term living arrangements within months after selling their ownership rights. He described the current plan as balancing "emotional, rational, and legal aspects" with "emotion first," while meeting residents' long-term housing needs. However, he stressed that this approach is "a special case within special circumstances and will not set a precedent."
The acquisition price for units in Wang Fuk Court, both with and without premium paid, is set at HK$8,000 and HK$10,500 per square foot, respectively. Wong explained that the acquisition price already considers whether residents can afford a property of a similar size to their original unit while retaining some funds for renovation. He emphasized that public funds must be used appropriately and balanced, noting that the offered price is significantly higher than the market price before the fire.
Wong also said that the government has included the required HK$4 billion in the Budget to be announced this Wednesday (Feb. 25), ensuring funds are available promptly after the Budget is approved. He emphasized that the HK$4 billion is entirely manageable compared to the government's total annual expenditure of approximately HK$800 billion and will not significantly impact the original financial plan.
According to an earlier survey, about 9% of affected residents preferred in-situ redevelopment. Wong, however, noted that resolving ownership issues for in-situ redevelopment would take about three years, followed by approximately 18 months for demolition and another four to five years for reconstruction, totaling possibly nine to ten years.
The timeline also involves transitional accommodation issues. If residents relocate to other districts for an extended period, emotional adaptation and living arrangements could be affected, and they might ultimately be unwilling to return to the original site, he added.
Owners of Wang Fuk Court must respond with their intentions by Aug. 31. Wong reiterated that after the deadline, cases without reasonable justification (e.g., inheritance disputes) will not be addressed. Affected units lack a normal market, and even if buyers are found, they may not achieve ideal prices. Owners who reject the government's proposal may face more difficulties in the future.
If the government cannot consolidate all ownership rights, would legislation be considered?
Wong stated that in the long term, the government may explore various approaches, including legislation. Article 6 of the Basic Law stipulates that the Hong Kong SAR shall protect the right of private property in accordance with law. Article 105(2) of the Basic Law provides that compensation for the lawful deprivation of property shall correspond to the real value of the property concerned at the time, be freely convertible, and paid without undue delay.
Wong referred to the Basic Law, noting that the compensation amount should be based on the "real value" of the property at the time.
"The real value, given that it (the Wang Fuk Court unit) was affected by the fire, is actually far lower than our offer... If this approach is to be implemented, it must ensure compliance with the Basic Law's protections for private property."
Wong emphasized that the current focus should not be on excessive debate but on continuing communication with residents in a consensual, humane manner.
Tony Wan, President of the Hong Kong Institute of Surveyors, mentioned on a radio program yesterday (Feb. 22) that, referencing secondary market transaction prices before the Wang Fuk Court fire, the estimated price per square foot for units without a premium paid is approximately HK$6,000, while for units with a premium paid, it is around HK$8,000, far lower than the government's acquisition prices (HK$8,000 and HK$10,500 per square foot, respectively).
He believes the government has balanced prudent financial management and compassion for the people in this arrangement, offering owners various options, and residents should be pragmatic and choose a swift solution.
"Money cannot solve all problems, but it can solve most of them."
He noted that in-situ redevelopment has low feasibility. Preliminary estimates based on current building standards suggest that the total floor area of the eight blocks of Wang Fuk Court is approximately 900,000 square feet. At a reconstruction cost of about HK$3,000 per square foot, in-situ redevelopment could involve around HK$2.7 billion.
"The deed of mutual covenant for Wang Fuk Court was established in the 1980s and only addresses major repairs, with no provisions for redevelopment. Therefore, unanimous consent from all owners is required for redevelopment. However, given that some owners perished in the fire and over 70% of respondents prefer acquisition or flat-for-flat arrangements, achieving unanimous consent for in-situ redevelopment is extremely difficult."
(Source: Wen Wei Po; Journalist: Li Qianxun)
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