The “secret” incentives : the feasibility of developer-initiated built heritage conservation in the urban area of Hong Kong

Abstract

With limited development sites sold in urban area by the government over past few years, site amalgamation becomes another source of land supply. Developers tend to acquire old buildings in prime locations and redevelop the sites to capture profit from unused development potential. The grading system in Hong Kong is administrative in nature with no statutory status. The grading does not confer statutory protection to the historic buildings. If the owner decides to pull down the graded building, the Government has no means to stop unless it is a declared monument. Since the Government considers pursuing heritage conservation through legislation would infringe private property rights, it advocates to conserve private-owned historic buildings by providing economic incentives and exploring development agreement with developers to encourage conservation-cum-development. This thesis focuses on the private-owned graded heritage property in urban area in Hong Kong. The study mainly concentrates on the conservation of heritage property in urban area (i.e. the Hong Kong Island and Kowloon Peninsula) as the land administration systems in New Territories before 1997 is quite different from the urban area. Many old government leases in old urban area in Hong Kong Island and Kowloon are unrestricted or with user restriction only, there is no specific development control such as land use, plot ratio and building height. Thus, the development potential of many sites with low-rise tenement buildings or structures built thereon is underutilized. Developers are ambitious to acquire and redevelop old buildings to capture the profit from unused development potential. We cannot expect the developers to turn away from their objective to maximize profits and to volunteer to preserve historical buildings in the community without any return. To reduce the threats of demolition of historical buildings for redevelopment, the scope of this study concentrates on the types of economic incentive for urban conservation offered by the Government and other incentives that available with the existing statutory and policy frameworks in Hong Kong that can encourage conservation of private-owned heritage.