Hong Kong Launches Additional Plot Ratio Pilot Scheme with Land Values Up to HK$7,804 per Sq Ft
HK01 · 3 SOURCESabout 3 hours ago2 MIN
Summary
The Development Bureau announced on June 19, 2024 that the Additional Plot Ratio Pilot Scheme will launch on September 1, 2024, covering seven designated old districts in Hong Kong . Eligible private redevelopment projects can receive an additional 20% plot ratio without paying land premium, enhancing financial viability for urban renewal . Developers may choose to increase gross floor area on-site or convert the credit into land value for use in other transactions including Northern Metropolis development . Standard land values for calculating the additional plot ratio range from HK$4,273 to HK$7,804 per square foot depending on location, with Sai Wan and Wan Chai commanding the highest rates .
Key Points
- Scheme covers seven old districts: Western District and Sheung Wan, Wan Chai, Ma Tau Kok, Mong Kok, Yau Ma Tei, Cheung Sha Wan, and Tsuen Wan
- Buildings must be at least 50 years old and sites at least 700 square metres (about 7,535 sq ft)
- Developers can apply to increase gross floor area by up to 20% on the original site, with land premium waived
- Alternatively, developers may convert the additional plot ratio into land value credit for use in the original project or any other land transactions across Hong Kong, valid for 10 years without interest or transferability
- Standard land values: Sai Wan and Wan Chai at HK$7,804 per sq ft; Mong Kok and Yau Ma Tei at HK$6,503; Ma Tau Kok at HK$6,131; Cheung Sha Wan at HK$5,853; Tsuen Wan at HK$4,273
Why It Matters
The pilot scheme directly addresses the growing challenge of aging buildings, with the number of 50-year-old or above structures expected to increase to over 700 per year in the next 15 years . By providing financial incentives and procedural flexibility, the government aims to unlock private sector participation in urban renewal, complementing the Lowering of Mandatory Auction Thresholds regulation . This initiative represents a significant policy shift to accelerate redevelopment of Hong Kong's older districts before building conditions deteriorate beyond safe renovation.
The pilot scheme directly addresses the growing challenge of aging buildings, with the number of 50-year-old or above structures expected to increase to over 700 per year in the next 15 years . By providing financial incentives and procedural flexibility, the government aims to unlock private sector participation in urban renewal, complementing the Lowering of Mandatory Auction Thresholds regulation . This initiative represents a significant policy shift to accelerate redevelopment of Hong Kong's older districts before building conditions deteriorate beyond safe renovation.