I don’t know how long the SCMP has been running a column called “Public Eye” by Michael Chugani but it definitely caught my eye this morning.  Here’s an excerpt from today’s column:

… think back to last week when we told you that the Housing Society has been hoarding hundreds of empty flats instead of selling them to low-income people like it’s supposed to. Well, the Housing Society contacted us to say it was only following government orders. Officials instructed it to hoard flats after the government decided to halt its own Home Ownership Scheme for the middle class. We all know the government turned off the flow of affordable flats for one reason only – to appease our property tycoons. When flat prices fell some years back, the developers got mad. So the government took HOS and Housing Society flats off the market to drive up prices. But what you do not know is this: taxpayers have been pouring millions into the upkeep of those empty flats. The Housing Society told us each one of its 838 empty flats costs HK$1,500 a month to maintain. That’s HK$1.25 million a month or HK$15 million a year. The flats have been empty for nine years. That’s about HK$137 million down the drain. The government has kept 4,000 HOS flats empty since 2003. You add up how many more millions have been wasted maintaining them.

That on its own is pretty damned interesting.  But let’s add in two other stories in today’s paper about New World’s latest mega real estate development in Tsim Sha Tsui, “The Masterpiece.”  Apparently the word “masterpiece” does not apply to the building itself but to the way in which New World exploited some loopholes to create and sell a property filled with private homes in an area not zoned for residential use.   The building contains 40 floors of flats in its 67 floors and has been selling them for HK$20,000 per square foot and up – one sold at a rate of $30,000 per square foot (845 square feet, total price over HK$25 million.

The Masterpiece, which rises 67 storeys in Hanoi Road, was built to density standards usually applied to commercial developments.  The builder, New World Development, was able to include the flats, which occupy 40 floors of the towering, wall-like structure, by describing them as serviced apartments.  The project … has a plot ratio – the formula that determines a site’s density, or permitted floor space as a multiple of the site area – of more than 12, well above the nine or at most 10 that architects and planners say would usually be approved for a mixed development in Kowloon. In building it New World was able to take advantage of a loophole that appeared in 1999 when the Lands Department, after lobbying by the Real Estate Developers Association, removed a ban on serviced apartments being sold to individual buyers. This window of opportunity, which opened two months before New World sought planning approval for the project, was later closed.  The development was also the first and only urban renewal project in which individual owners were allowed to take part. When the project was launched, it became clear that New World owned most of the properties in 20 rundown blocks in Hanoi Road cleared to make way for it. Now the Planning Department is under pressure to explain why the site is zoned commercial while most of the development is clearly residential.

While there’s no proof, it certainly gives the appearance of our non-elected non-representational government working in collusion with the major real estate developers, doesn’t it?   Another article in the SCMP scores further points in this betrayal of the public trust:

Even more remarkable is the fact that the development, with its 345 flats, sits in an area zoned for purely commercial purposes – not incompatible with the original concept for the 7,600 square metre site of offices and a mall, but at odds with its present incarnation.  Veteran architect Patrick Lau Sau-shing, a member of the board from 1998 to 2006 and a former vice-chairman, said he could not specifically recall the planning application for K11. But he believed the project had gained extra floor space because the application was made for a purely commercial development.  While the project was awarded a plot ratio of more than 12, Lau said such a development in Kowloon should not be given a ratio of more than 10.  Kim Chan Kim-on, vice-president of the Hong Kong Institute of Planners, said: “Developers should get a maximum plot ratio of nine for composite buildings in Kowloon.”  Ada Wong Ying-kay, a member of the Development Bureau’s committee reviewing the city’s redevelopment strategy, said the case showed how social mission had been sacrificed for profit in urban renewal. She believed the URA’s involvement had made it easier for the project to gain planning permission because it commanded high respect from planners and officials.  “Instead of serving the public by regenerating their living environment, the URA becomes a developer and creates gentrification,” she said.  The project was also the first and only public-sponsored redevelopment that allowed property owners’ participation. By November 1998, it was clear that most of the properties were owned by New World. Instead of issuing a tender to seek joint-venture partners, the LDC formed a joint venture with New World.

Basically, New World did what it wanted to, without any fear of reprimand or reprisal, because they knew there wouldn’t be any.  No one is going to tell them to take it down.  No one’s going to say, “You lied to us so you can’t build any more buildings in Hong Kong for five years.”  No one’s going to say, “you lied to us, give us 50% of the sales as a penalty.”

Hong Kong – if you’re rich, you can do whatever you want.