Analysing REITS

[soros]

This is copied from the HK Government Rates Dept website :

All land leases in the New Territories and New Kowloon north of Boundary Street expired on 27 June 1997. However, Annex III to the Sino-British Joint Declaration provided that non-renewable land leases which expired before 30 June 1997 were automatically extended up to 30 June 2047 without payment of an additional premium but with a new Government rent becoming payable from the date of extension. In addition, all land leases whether on Hong Kong Island, Kowloon, or the New Territories which have been granted since 27 May 1985, the date from which the Joint Declaration took effect, are also liable for the new Government rent from 1 July 1997.

The assessment and collection of the new Government rent is governed by the Government Rent (Assessment and Collection) Ordinance (Cap. 515). The Government rent charged under the Ordinance is calculated at 3% of the rateable value of the property and is adjusted in step with any subsequent changes in the rateable value.

So the leases will have to be renewed soon or the property valuation system will come to a full stop and the end of the HK banking system .