Surveying & Built Environment Vol. 22 Issue 1 (December 2012)

Footnote 43 in Cheung’s (1975) work
states, “In a forthcoming book which
investigates various rent controls in
Hong Kong (Cheung, in progress),
detailed evidence will be presented to
confirm that premature reconstructions
occurred in some tenements protected
by the Landlord and Tenant Ordinance
during the postwar period.” (Cheung
1975: p.15) That book has not yet
appeared. Cheung’s (1979) paper on
housing reconstruction in post-war
Hong Kong examines, among other
things, 185 Land Tribunal cases heard
from 1969 to 1972 in relation to s.11 (A)
of the Landlord and Tenant Ordinance.
In that later paper the focus shifts from
reconstruction as a means used by the
landlord to circumvent any rent cap to:
(a) the landlord’s drive to
reconstruct to minimise loss due
to the introduction in 1962 of
plot ratio control in the Buildings
Ordinance, which reduced the
permitted floor area; and
(b) overcoming tenants
who were holding out when
landowners find it more
profitable to redevelop
In this latter regard s.11 (A), introduced
in 1968 to allow private negotiation
between landlord and tenant, was
found useful in preventing premature
redevelopment by overcoming the
holding out problem.
Cheung’s (1974) theory of price control
covers all types of regulation of the
market and thus one should appreciate
that his (1979) case study demonstrates
well the predictive power of his theory.
Nonetheless, evidence remains wanting
of pre-mature redevelopment intended
Surveying and Built Environment Vol 22, 88-90 Nov 2012 ISSN 1816-9554
only to by-pass rent control itself rather
than any other form of control, yet
that was nonetheless not a response to
growing demand.
In the light of this, we can turn to a
University of Hong Kong dissertation
by Lu (2007) on architectural
conservation in Kadoorie Hill,
developed and owned substantially by
Hongkong Engineering & Construction
Company Ltd., controlled by the
famous Kadoorie family. This does
provide real life, post-war evidence in
support of Cheung’s (1975) theory of
pre-mature redevelopment due to rent
control.
Lu’s (2007) dissertation recorded that
the 1980 annual report of this company
stated,
“as prewar properties are not
subject to the control of Landlord
and Tenant (Consolidation)
(Amendment) Ordinance 1980,
the renewal rentals of the
Company’s pre-war properties
have been brought up to
realistic levels as have other
properties upon vacation by
tenant...it has been decided not
to proceed with the demolition
and re-development of six of the
Company’s small pre-war houses
in Kadoorie Avenue...Instead,
complete renovation of some
of the houses is under active
consideration.” (Lu, p.39 of the
e-thesis)
This is the public statement of a
landlord in relation to rent control.
This piece of information supports
Cheung’s (1975) theory. One year
earlier, the company had expressed
worries about the adverse effects of a
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