LUCKTIME LTD AND OTHERS v. YAM DO KAI PETER, the Executor of the Estate of YAM KUNG YIN SHANG also known as KUNG YIN SHANG (or SHEUNG) also known as KUNG WING HAR, deceased AND OTHERS

LDCS 1000/2024

[2026] HKLdT 31

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

LAND COMPULSORY SALE MAIN APPLICATION NO 1000 OF 2024

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JUDGMENT

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BACKGROUND

1.  This is the applicants’ application for an order for sale (“the Application”), for the purposes of redevelopment under the Land (Compulsory Sale for Redevelopment) Ordinance, Cap 545 (“the Ordinance”), of all the undivided shares of and in the following lots (collectively referred to as “the Lot” where appropriate) with the corresponding buildings (“the Buildings”) erected thereon:

Lot No	Address
The Remaining Portion of Sub-section 13 of Section A of Hung Hom Marine Lot No 1 (“1st Lot”)	Nos 18, 18A, 20 & 20A Whampoa Street (“1st Building”)
The Remaining Portion of Sub-section 15 of Section A of Hung Hom Marine Lot No 1 (“2nd Lot”)	Nos 22, 22A & 24 Whampoa Street and Nos 88, 90 & 90A Baker Street (“2nd Building”)

2.  Standing on the Lots is a pair of 8-storey tenement blocks fronting onto Whampoa Street, each of which is served by 2 common staircases.

3.  Occupation permit No K15 of the 1^st Building was issued on 13 March 1957, granting permission to occupy its ground floor (“G/F”) for non‑domestic purpose and upper floors for domestic purpose. According to the approved building plans of the 1^st Building dated 5 September 1956, there are two shops on G/F, one at G/F, 18 Whampoa Street, and another at G/F, 20 Whampoa Street. The rear side of the two shops, that is 18A Whampoa Street and 20A Whampoa Street respectively, being separated by the two common staircases in the middle, are designed for storage purposes.

4.  Each of the upper floors of the 1^st Building comprised originally 4 domestic units.

5.  By reference to the Second Schedule to the Deed of Mutual Covenant of the 1^st Building dated 20 September 1957, each of the units mentioned above has been allotted one equal undivided share of the 1^st Lot.

6.  On 6 December 2024 when the applicants filed the Notice of Application, the ownership of the 1^st Building is shown as follows:

Unit Owned	No of Undivided Share	Name of Applicant
G/F, 18 Whampoa Street	1/32	Lucktime Limited (1st Applicant)
1/F, 18 Whampoa Street	1/32	Asia Harbour Investment Limited (2nd Applicant)
2/F, 18 Whampoa Street	1/32	Gentway Limited (5th Applicant)
3/F, 18 Whampoa Street	1/32	Yam Do Kai Peter, The Executor of the Estate of Yam Kung Yin Shang, deceased (1st Respondent)
Front Portion of 4/F, 18 Whampoa Street	½ of 1/32	Lucktime Limited (1st Applicant)
Rear Portion of 4/F, 18 Whampoa Street	½ of 1/32
5/F, 18 Whampoa Street	1/32	Sino Accord Investment Limited (6th Applicant)
6/F, 18 Whampoa Street	1/32	Fortress Star Limited (10th Applicant)
7/F, 18 Whampoa Street	1/32	Lucktime Limited (1st Applicant)
G/F, 18A Whampoa Street	1/32	Lucktime Limited (1st Applicant)
1/F, 18A Whampoa Street	1/32	South Crown Development Limited (3rd Applicant)
2/F, 18A Whampoa Street	1/32	Kwan Wai Yuen & Chiu Wai Ching Elsa (2nd Respondents)
3/F, 18A Whampoa Street	1/32	The Personal Representative of Jang Bang, deceased (3rd Respondent)
4/F, 18A Whampoa Street	1/32	Kwan Wai Yuen & Chiu Wai Ching Elsa (2nd Respondents)
5/F, 18A Whampoa Street	1/32	First Mate Development Limited (7h Applicant)
6/F, 18A Whampoa Street	1/32	Lucktime Limited (1st Applicant)
7/F, 18A Whampoa Street	1/32
G/F, 20 Whampoa Street	1/32	Kwan Wai Yuen & Chiu Wai Ching Elsa (2nd Respondents)
1/F, 20 Whampoa Street	1/32	Asia Charming Limited (4th Applicant)
2/F, 20 Whampoa Street	1/32	Kwan Wendy (4th Respondent)
3/F, 20 Whampoa Street	½ of 1/32	Lucktime Limited (1st Applicant)
	½ of 1/32	Chan Chuk, Chin Koy Hey, Chan Tak Ping and The Personal Representative of Chan Pui Fun, deceased (5th Respondent)
4/F, 20 Whampoa Street	1/32	Lucktime Limited (1st Applicant)
5/F, 20 Whampoa Street	1/32	Group Leader Limited (8th Applicant)
6/F, 20 Whampoa Street	1/32	Lucktime Limited (1st Applicant)
7/F, 20 Whampoa Street	1/32
G/F, 20A Whampoa Street	1/32	Ningee Limited (6th Respondent)
1/F, 20A Whampoa Street	1/32	Lucktime Limited (1st Applicant)
2/F, 20A Whampoa Street	1/32	Kwan Shuk Man (7th Respondent)
3/F, 20A Whampoa Street	1/32	Lucktime Limited (1st Applicant)
4/F, 20A Whampoa Street	1/32	Kwan Hei Lam (8th Respondent)
5/F, 20A Whampoa Street	1/32	Ever Planet Limited (9th Applicant)
6/F, 20A Whampoa Street	1/32	Lucktime Limited (1st Applicant)
7/F, 20A Whampoa Street	1/32

7.  Thus, insofar as the 1^st Lot is concerned, the applicants altogether own 70.31% of the equal undivided shares in the 1^st Lot.

8.  On the other hand, Lucktime Limited, ie the 1^st Applicant, has been the registered owner of all undivided shares of the 2^nd Lot. The 2^nd Building erected thereon was also completed in 1957 with Occupation Permit No K23 issued on 16 April 1957.

9.  Indeed, the 2^nd Lot was the subject of an earlier compulsory sale application, being Lucktime Limited v Cho Kai Fung & Others, LDCS 2000/2018, the sale order of which was granted by the Tribunal on 29 January 2021. Particulars of the 2^nd Lot and the 2^nd Building thereon can be found in the contents of that judgment.

THE REMAINING RESPONDENTS

10.  By reference to the table of ownership in §6 above, the applicants altogether own 70.31% of the equal undivided shares in the 1^st Lot. There are 8 live respondents (collectively referred to as “the Remaining Respondents”):

Respondent		Premises	Undivided share in the 1st Lot	Notice of Opposition
1st Respondent	(“R1”)	3/F, No 18 Whampos Street	1/32	Withdrawn
2nd Respondents	(“R2”)	G/F, No 20 Whampoa Street	3/32	Withdrawn / to be withdrawn
		2/F. No 18A Whampoa Street
		4/F, No 18A Whampoa Street
3rd Respondent	(“R3”)	3/F. No 18A Whampoa Street	1/32	Missing
4th Respondent	(“R4”)	2/F. No 20 Whampoa Street	1/32	Withdrawn / to be withdrawn
5th Respondents	(“R5”)	4/8 share of 3/F of No 20 Whampoa Street	½ of 1/32	Missing / unopposed
6th Respondent	(“R6”)	G/F, No 20A Whampoa Street	1/32	Withdrawn / to be withdrawn
7th Respondent	(“R7”)	2/F, No 20A Whampoa Street	1/32	Withdrawn / to be withdrawn
8th Respondent	(“R8”)	4/F, No 20A Whampoa Street	1/32	Withdrawn / to be withdrawn

11.  More particularly, R1 reached full settlement with the applicants through mediation on 25 February 2025. Leave was granted to R1 to withdraw his Notice of Opposition by H H Judge Michelle Lam pursuant to the Order dated 14 March 2025. R1 was also excused from attending the trial.

12.  R3 and the 1^st, 2^nd and 4^th named R5 cannot be found. Substituted service of the Application on them was effected on 17 October 2025 pursuant to the Order of H H Judge Michelle Lam dated 8 October 2025. None of them have showed up after expiration of the 21-day period as specified respectively in the notices.

13.  Pursuant to paragraphs 1 and 4 of the aforesaid Order, service of the aforesaid Order, the Notice of Application, Mediation Certificate, Mediation Notice and all subsequent documents in the present proceedings on R3 and the 1^st, 2^nd and 4^th named R5 was dispensed with.

14.  According to paragraph 3 of the aforesaid Order, after expiration of 21 days from the publication of the notices mentioned in paragraph 12 above, R3 and the 1^st, 2^nd and 4^th named R5 shall be bound by the proceedings as if they have been duly served with the Application in accordance with section 3(3)(a) of the Ordinance.

15.  Madam Leung Yuk Chun, the 3^rd named R5, was subsequently joined pursuant to an Order dated 25 March 2026 by H H Judge Michelle Lam in her capacity as the administratrix of the estate of Chan Tak Ping, deceased. Madam Leung has confirmed to the Tribunal that she will not oppose the Application and will not attend the trial. She also undertook not to seek costs against the applicants in these proceedings up to and inclusive of the trial. Accordingly, Madam Leung was excused by the order of H H Judge Michelle Lam from attending the trial. It was also ordered that “there be no filing of Notice of Opposition (Form 33) by the 3^rd named R5 in these proceedings” and that “there be no adducing of any evidence, whether expert or factual, in opposition to these proceedings by the 3^rd named R5.

16.  R2, R4, R6, R7 and R8 are represented by Messrs Peter Mo & Co. They have entered into Provisional Agreements for Sale and Purchase on 28 April 2026 for selling their properties to A1. The transactions will be completed in due course. Leave was granted to R2, R4, R6, R7 and R8 to withdraw all their Notices of Opposition and evidence (whether factual and expert) on 30 April 2026.

ISSUES FOR DETERMINATION BY THE TRIBUNAL

17.  The remaining issues to be decided in this case are as follows:

(1)  Whether the applicants have satisfied the relevant statutory requirements under the Ordinance and hence were entitled to make the Application?

(2)  Whether the redevelopment of 1^st Lot is justified due to age and/or state of repair of the 1^st Building in accordance with section 4(2)(a)(i) of the Ordinance?

(3)  Whether the applicants have taken reasonable steps to acquire all the undivided shares in the 1^st Lot in accordance with section 4(2)(b) of the Ordinance?

(4)  What were the respective market value of the properties according to paragraph 1(a) in Part 1A of Schedule 1 to the Ordinance (which is hereinafter termed “EUV”) on the 1^st Lot as at 15 November 2024?

(5)  What should be the redevelopment value (“RDV”) of the 1^st Lot as at 15 November 2024?

(6)  What should be the RDV of the 2^nd Lot as at 15 November 2024?

(7)  If an order for sale should be granted, what should be the reserve price (i.e. RDV of the Lots) for the purpose of auction sale?

SECTION 3 OF THE ORDINANCE – OWNERSHIP OF THE APPLICANTS

18.  At the time of filing of the Application on 6 December 2024, the amendments to the Ordinance passed in July 2024 came into operation.

19.  By virtue of the newly amended section 3(2)(c) of the Ordinance, the person or persons who owns or own, otherwise than as a mortgagee, not less than 90% of the undivided shares in a lot may make an application which may cover 2 or more lots that are adjoining lots (one set of adjoining lots) even if any of the lots is wholly owned by the majority owner. This is exactly the case for the captioned application when the applicants have owned 100% of the 2^nd Lot.

20.  Section 3(5) of the Ordinance provides that the Chief Executive in Council may, by notice in the Gazette, specify a lower percentage in respect of a lot belonging to a class of lots specified in that notice.

21.  The Land (Compulsory Sale for Redevelopment) (Specification of Lower Percentage) Notice (“the Notice”) was similarly amended in December 2024. Section 3 of the Notice lowered the threshold for compulsory sale of specified classes of lots from 90% to 70%. Those classes of lots include:

“a lot that is not located within a designated area, and with each of the buildings erected on the lot issued with an occupation permit at least 60 years but less than 70 years before the relevant date”

22.  At the time of filing the Application, the Lots were included in the Approved Hung Hom Outline Zoning Plan No S/K9/28 dated 10 June 2022 and hence, they were not located within any of the “designated areas” set out in the Schedule to the Notice. Since the occupation permits of the Buildings were both issued in 1957, i.e. more than 60 years but less than 70 years before the date of application (i.e. 6 December 2024, the relevant date under the Notice), the applicable percentage is therefore 70%.

23.  Section 3(8)(c) of the Ordinance also provides that where 2 or more lots are adjoining lots, the averaging requirement is fulfilled for 2 or more lots if the average of the percentage of the undivided shares owned by the majority owner in the lots (“averaged ownership percentage”) is not less than the specified threshold percentage, where—

(i)  averaged ownership percentage is derived by aggregating the sum of the percentages of the undivided shares owned by the majority owner in each of the lots (if it belongs to a specified class of lots) multiplied by the area of the corresponding lot (“total sum”), then dividing the total sum by the total area of all the lots concerned; and

(ii)  specified threshold percentage is derived by aggregating the sum of the percentages specified in section 3 of Cap. 545A for each of the lots (if it belongs to a specified class of lots) multiplied by the area of the corresponding lot (“total sum”), then dividing the total sum by the total area of all the lots concerned.

24.  The 1^st Lot has a site area of 3,400 sq ft while the 2^nd Lot has a site area of 4,675 sq ft. Pursuant to the above, the average ownership percentage owned by the applicants altogether is 87.5%:

25.  I am satisfied that as at the date of the Application, the applicants altogether owned more than 70% of the undivided shares in the Lots. I am therefore satisfied the applicants altogether are entitled to make the present application under section 3 of the Ordinance.

SECTION 4(2) OF THE ORDINANCE - JUSTIFICATION AND REASONABLE STEPS

26.  Section 4(2) of the Ordinance provides as follows: -

“2. The Tribunal shall not make an order for sale unless, after hearing the objections, if any, of the minority owners of the lot the subject of the application under section 3(1) concerned, the Tribunal is satisfied that—

(a) the redevelopment of the lot is justified (and whether or not the majority owner proposes to or is capable of undertaking the redevelopment)—

  (i) due to the age or state of repair of the existing development on the lot; or

  (ii) on 1 or more grounds, if any, specified in regulations made under section 12; and

(b) the majority owner has taken reasonable steps to acquire all the undivided shares in the lot (including, in the case of a minority owner whose whereabouts are known, negotiating for the purchase of such of those shares as are owned by that minority owner on terms that are fair and reasonable).”

Whether development of the Lot is justified due to the age and/or state of repair of the Building

27.  However, section 4(2C) of the Ordinance as amended expressly provides that subsection (2) afore-stated does not apply to a lot which is wholly owned by the majority owner, ie the applicants in the present proceedings.

28.  Accordingly, the Tribunal is not required to consider whether redevelopment of the 2^nd Building is justified or not.

29.  In respect of the 1^st Lot, the applicants have appointed Mr Wong Wing Cheung, Dennis (“Mr Dennis Wong”) who is a Registered Professional Surveyor (Building Surveying), Authorized Person and Registered Structural Engineer to prepare a Condition Survey Report and a Structural Assessment Report both dated 21 July 2025.

30.  In respect of the age of the 1^st Building, Mr Dennis Wong highlighted that it was 68 years old. Due to changes in statutory requirements, advanced technology and higher expectation of the owners over the years, the 1^st Building has become substandard and obsolete in respect of the following aspect when compared to a new building if the site is redeveloped:

•   Safety;

•   Health and hygiene;

•   Comfort and convenience;

•   Expectations and enjoyment;

•   Environment; and

•   Management and maintenance.

31.  More particularly, there are vital deficiencies that cannot be overcome but have an adverse effect on the users in various aspects, including but not limited to:

•   Provision of escape staircases complying with current requirements/ standards;

•   Provision of barrier free access facilities.

32.  Mr Dennis Wong was also of the view that the 1^st Building is in a poor state of repair. According to him, the costs of essential repairs amounted to $12,631,247 or $7,523.57 per m² of the existing Gross Floor Area of the 1^st Building. This unit cost is about 46.96% of the unit cost of $16,019.81 per m² for re-constructing a new similar building. Mr Dennis Wong opined that the rectification/ repair costs were relatively high.

33.  Turning to the structural assessment of the 1^st Building, Mr Dennis Wong found a substantial number of defects such as cracks and spalling. In the open-up inspection, 26/87 or 29.9% of the steel reinforcement bars were under the classification of “Severe Corrosion”, 67/87 or 77.0% were seriously corroded according to the classification by Code of Practice of the Mandatory Building Inspection Scheme (MBIS) 2012. The effect of serious corrosion can result in a reduction in the load-carrying capacity of the structural members and impair the building structure as a whole.

34.  In addition, 100% of the slab and 65.5% of the beam samples failed to satisfy the minimum concrete cover requirement of the Code of Practice for Structural Use of Concrete 2013 (“2013 Concrete Code”). 88.9% of all samples failed to satisfy the minimum concrete strength requirement of 20 MPa as specified in the code.

35.  Also, all the samples had carbonation reaching a depth greater than the concrete cover. This implies that the protective barrier of the reinforcement bars has been lost, allowing active deterioration/ corrosion of the reinforcement bars to develop. Similarly, 72% of the test samples failed to meet the maximum chloride content of 0.35%, some with chloride contents as high as 3.21%.

36.  Mr Dennis Wong has summarised the structural conditions of the 1^st Building as follows:

Durability Provisions		2013 Concrete Code	The 1st Building
Concrete Cover	Slab	Min 30mm	100% of the samples were less than 30mm
	Beam	Min 35mm	65.5% of the samples were less than 35mm
	Column	Min 35mm	27.6% of the samples were less than 35mm
Grade of Concrete		Minimum design concrete cube strength = 20 MPa	Average in-situ concrete cube strength: 13.4 MPa for slabs 9.8 MPa for beams 15.1 MPa for columns
Chloride Content (by mass of cement)		Max 0.35%	The average chloride content of all the samples was 0.96%
Cement Content		Min 290 kg/m2 (for Grade C20) (12.08% by mass)	The average cement content of all the samples at 21.9% complied with the required minimum cement content of 12.08%. Nevertheless, 11.1% of the test samples failed to meet this requirement.

37.  In view of the above, Mr Dennis Wong considered that the 1^st Building had passed its design working life of 50 years on which basis the requirements of the 2013 Concrete Code were set up.

38.  There is no expert evidence to rebut the reports complied by Mr Dennis Wong.

39.  Having considered the reports of Mr Dennis Wong, I accept his expert opinion. The 1^st Building, being erected more than 69 years ago, is in poor condition and has come to the end of its design life. The design of the 1^st Building has become obsolete over time in many aspects, both physically and functionally, and fails to conform to modern safety standards and statutory requirements.

40.  I am satisfied that the 1^st Building is in poor state of repair and the costs of repair to bring the 1^st Building to tenantable condition is disproportionate to the costs of redevelopment. Even if repair works are carried out, such works will bring about a modest improvement only to the existing condition of the 1^st Building and the 1^st Building will continue remain a sub-standard one.

41.  By reason of the matters set out above, I am satisfied that the redevelopment of the 1^st Building is justified.

Whether the applicant has taken reasonable steps

42.  In assessing the reasonableness of the offers, I have considered the case of Capital Well Ltd v Bond Star Development Ltd (2005) 8 HKCFAR 578. In particular, I have considered paragraphs 33 and 36 of the judgment in which Ribeiro PJ stated: -

“33. In making that assessment the Tribunal is not conducting a valuation exercise. It does not need to adjudicate upon any disputes about the correct valuation principles to be applied. It does not itself arrive at any conclusion as to what figure represents the correct valuation. It merely needs to be satisfied that, on the evidence available, the offer falls within the range of what may broadly be regarded as fair and reasonable compensation for the interest in question. It is obviously necessary to recognise that there will often be differences of opinion on that matter……”

“36. ...... We are of course not suggesting that it is necessary for the offer to “beat” the valuation as if it were a payment into court. What the Tribunal must do is to consider whether, in the circumstances of each case, the offer falls within a band of what represents a fair and reasonable assessment of the value of the minority owner’s interest reflecting a proportionate share of the redevelopment value of the whole site……”

43.  Firstly, at the date of the Application, the applicants already owned 70.31% of the undivided shares of and in the 1^st Lot. Ms Nancy Ngai (“Ms Ngai”), counsel of the applicants, submitted that the applicants could have applied for an Order for sale of the 1^st Lot alone pursuant to section 3(1) of the Ordinance. Nevertheless, the applicants did not do so. Instead, by adding the 2^nd Lot which had been wholly owned by the 1^st applicant in the Application, a larger site was resulted, rendering a more viable development and more compensation to the minority owners of the 1^st Lot. Ms Ngai submitted that the applicants had taken not only a fair and reasonable step but a generous step in favour of the minority owners of the 1^st Lot.

44.  Despite the applicants have commenced the Application, they continued to negotiate with the minority owners of the 1^st Lot with a view to purchasing their properties by negotiation.

45.  I agree also that the settlement finally reached with R1, R2, R4, R6, R7 and R8 provides solid evidence for proving that the applicants have indeed taken reasonable steps to acquire the undivided shares owned by the respondents.

46.  I accept that the applicants have not been able to acquire the undivided shares of and in the 1^st Lot owned by R3 and the 1^st, 2^nd and 4^th named R5 solely because they could not (and still cannot) be found.

47.  On 17 April 2026, the 3^rd named R5 confirmed that she would not oppose the Application. Indeed, after the 3^rd named R5 turned up, the applicants made open offers to her for purchasing 1/8 share of 3/F, No 20 Whampoa Street on 2 April 2026 and 24 April 2026 in the amount of $830,000[1] and $870,000[2] respectively.[3]

48.  These open offers were made by reference to Mr CW Wong’s independent valuation opinion which will be summarised below. I accept that these open offers were higher than the value attributable to the 3^rd named R5’s interest in 3/F, No 20 Whampoa Street calculated in accordance with the statutory formula set out in the Ordinance.

49.  By reason of the matters set out above, I am satisfied that the applicants have taken reasonable steps to acquire all the undivided shares in the 1^st Lot.

50.  While I am satisfied that the redevelopment of the 1^st Lot is justified and the applicants have taken reasonable steps to acquire all the undivided shares in the 1^st Lot, an order for the sale of both the 1^st Lot and the 2^nd Lot should be granted in favour of the applicants.

DETERMINATION OF THE EUV OF ALL UNITS IN THE 1^ST BUILDING

51.  Under section 4(1)(a)(i) of the Ordinance, if there is a dispute between the parties on the EUV of the units in the Buildings on the Lots, the Tribunal has to determine the values.

52.  Section 4(1)(a)(ii) further provides that, in the case of any minority owner of the 1^st Lot who cannot be found, the majority owner of the 1^st Lot is required to satisfy the tribunal that the value of the minority owner’s property as assessed in the Application is: -

“(A) not less than fair and reasonable; and

(B) not less than fair and reasonable when compared with the value of the majority owner’s property as assessed in the application.”

53.  Mr Wong Chi Wai (“Mr CW Wong”) of Grandmax Surveyors Limited has been appointed by the applicants to prepare the following reports:

(1)  Valuation Report dated 4 December 2024 on

•  EUV of the properties on the 1^st Lot as at 15 November 2024;

•  RDV of the 1^st Lot as at 15 November 2024; and

•  RDV of the 2^nd Lot as at 15 November 2024

(2)  Supplemental Report dated 17 July 2025 on

•  EUV of the properties on the 1^st Lot as at 15 November 2024;

•  RDV of the 1^st Lot as at 15 November 2024;

•  RDV of the 2^nd Lot as at 15 November 2024; and

•  RDV of the Lots as at 14 July 2025

(3)  Supplemental Report dated 26 March 2026 on the RDV of the Lots.

54.  In the Valuation Report of 4 December 2024 (“the Application Report”), Mr CW Wong explained the method of valuation and the process of his assessment to arrive at the EUV of each unit of the 1^st Building.

55.  In his valuation of the EUV of the domestic units on the upper floors of the 1^st Building, Mr CW Wong adopted the following methodology:

(i)  He selected 3/F, No. 18 Whampoa Street as the reference unit (“the Reference Domestic Unit”) for the purpose of valuing its unit price.

(ii)  The unit price of the Reference Domestic Unit was first assessed by making reference to market comparables. He took into account 4 comparable transactions, 3 of which in Bou Lee Building at 145-163 Bulkeley Street across the other side of Gillies Avenue South in the vicinity of the Hung Hom district. After making what he regarded as the necessary adjustments (for time, location, floor level, age, size, physical condition, view, lighting & ventilation) for all these comparable transactions, he took the average of the adjusted unit rates of the comparables at $63,000 per m² as the unit price of the Reference Domestic Unit.

(iii)  He further considered the floor level, size, lighting & ventilation, top floor effect and internal conditions of the Reference Domestic Unit and the remaining domestic units within the 1^st Building and made adjustments to arrive at the EUV of all the domestic units on the upper floors of the 1^st Building.

56.  In assessing the EUV of the ground floor units, Mr CW Wong adopted the following methodology:

(i)  He selected Ground Floor, No 20 Whampoa Street as the Reference Shop Unit.

(ii)  He then took into account 4 comparable shop transactions in the Hung Hom district. After making what he regarded as the necessary adjustments (for time, location, frontage, return frontage, age, size, layout and headroom) for all these comparable transactions, he took the average of the adjusted unit rates of the comparables at $303,000 per m² as the unit price of the Reference Shop Unit.

(iii)  Whereas both the G/F, 18A and 20A Whampoa Street are storage space instead of shop units having street frontages, being situated at the rear of the 1^st Building accessible only via an indoor common corridor some 14 metres from the building entrance, Mr CW Wong applied a discount of 70%.

57.  Mr CW Wong updated the Application Report by another report dated 17 July 2025 (ie the Supplemental Report) in which he revised the EUV of all the units in the 1^st Buildings after taking into account the inspection of more units in the 1^st Building and the updated property index prepared by the Rating and Valuation Department. In this report, Mr CW Wong found 4 more up-to-date comparables and repeated the exercise he did in the Application Report. He arrived however at the same rate of $63,000 per m² as the unit price of the Reference Domestic Unit.

58.  Similarly, Mr CW Wong found 2 more up-to-date comparables for the ground floor shop units. This time, he arrived at $301,000 per m² as the unit price of the Reference Shop Unit.

59.  The updated EUV of all the units in the 1^st Building as assessed by Mr CW Wong is set out in the following table:[4]

Unit / Floor	Whampoa Street
	No 18	No 18A	No 20	No 20A
G/F	$12,437,000	$4,078,000	$12,437,000	$4,078,000
1/F	$3,515,000	$2,873,000	$3,623,000	$2,907,000
2/F	$3,553,000	$2,997,000	$3,661,000	$2,851,000
3/F	$3,483,000	$2,938,000	$3,379,000	$2,710,000
4/F	$3,313,000[5]	$2,966,000	$3,313,000	$2,741,000
5/F	$3,142,000	$2,738,000	$3,243,000	$2,684,000
6/F	$3,039,000	$2,763,000	$3,039,000	$2,546,000
7/F	$2,777,000	$2,492,000	$2,693,000	$2,441,000

60.  Thus, the total EUV of the 1^st Building as assessed by Mr CW Wong as at 15 November 2024 is $117,450,000.

61.  I am satisfied that the value of the respondent unit as assessed by Mr CW Wong is not less than fair and reasonable; and not less than fair and reasonable when compared with the value of the applicants’ properties.

RDV FOR THE 1^ST LOT AND THE 2^ND LOT

62.  Paragraph 2 in Part 3 of Schedule 1 to the Ordinance as amended provides that, for an order for sale of lots the subject of an application that covers more than one lot, the proceeds of sale of the lots—

(a)  are to be apportioned between the lots on a pro rata basis in accordance with, and subject to paragraph (c)—

(i)  for a lot governed by a deed of mutual covenant covering that lot only, the redevelopment value of the lot as assessed in the application under section 1(b)(i) of Part 1A of this Schedule; and

(ii)  …

(b)  are to be apportioned between each majority owner and each minority owner of a lot on a pro rata basis in accordance with, and subject to paragraph (c), the values of the respective properties of each majority owner and each minority owner of the lot as assessed in the application under section 1(a) of Part 1A of this Schedule; and

(c)  where—

(i)  there has been a dispute referred to in section 4(1)(a)(i) that has resulted in a variation of those values; or

(ii)  in consequence of the requirement under section 4(1)(a)(ii) on the majority owner to satisfy the Tribunal as to the matter referred to in that section, there has been a variation of those values,

are to be apportioned in accordance with those values as so varied.

63.  As a result of paragraph 62 (a)(i) above, Mr CW Wong had prepared valuations on the RDV of the 1^st Lot and the RDV of the 2^nd Lot as at 15 November 2024 by means of the residual valuation method. This can be done by deducting development cost (including construction costs, professional fees, finance costs etc) and developer’s profit from the estimated gross development value (“GDV”) of the completed optimum development.

64.  In arriving at the GDV of each hypothetical development, Mr CW Wong had gathered the relevant sales comparables and repeated the exercises of what he had done in assessing the EUV of each unit of the 1^st Building save that this time, the sales comparables are sales of relatively new properties.

65.  Mr CW Wong then assessed the construction and demolition costs by reference to the “Building Cost Data for Private Sector Developments in Hong Kong” prepared by Rider Levett & Bucknall which is a popular international quantity surveying consultancy firm in the real estate and construction industry.

66.  Mr CW Wong also explained that in considering the plenty supply for new domestic units in the Hung Hom locality, a 20% profit would have fairly reflected the project risk and return of these hypothetical developments for either the 1^st Lot or the 2^nd Lot as at 15 November 2024.

67.  Mr CW Wong arrived at the RDV of the lots at $118,000,000[6] and $229,000,000[7] respectively.

68.  The significant difference between the two values can firstly be explained by the difference in site areas between the two lots. According to Mr CW Wong, the 1^st Lot has a net site area of 306.87 sq m while the 2^nd Lot has a net site area of 434.32 sq m. While they fell within an area designated as “Residential (Group A) 4” on the Approved Hung Hom Outline Zoning Plan No S/K9/28 dated 10 June 2022, under this zoning designation, a maximum building height restriction of 100mPD would be permitted for sites with an area of 400 m² or more[8]. Otherwise, like that of the 1^st Lot, the maximum building height restriction would be only 80mPD.

69.  In addition, the 2^nd Lot, being a corner lot, enjoys shop frontages on two streets and a higher plot ratio under the Building (Planning) Regulations as a Class B site.

RESERVE PRICE FOR THE AUCTION

70.  In his latest valuation report dated 26 March 2026, Mr CW Wong proceeded to update the RDV of both the 1^st Lot and the 2^nd Lot, taking into account the joint redevelopment potential of the Lots on their own by the residual valuation method.

71.  Mr CW Wong arrived at $580,000,000 which is equivalent to an accommodation value of $85,904 per m². A copy of his calculation is attached herein as Appendix 1[9].

72.  I have gone through Mr CW Wong’s valuation. In the absence of evidence to the contrary, I am satisfied with his valuation, including the valuation assumptions he has adopted, the values and the costs parameters he has used in his valuation.

73.  Based on Mr CW Wong’s valuation, therefore, I decide that the reserve price for the auction of both the 1^st Lot and the 2^nd Lot together should be HK$580,000,000.

ORDERS

74.  For reasons given in this judgment, I have set out reasons why I am satisfied an order for sale should be granted and I therefore make the following orders: -

(1)  All the undivided shares in both the 1^st Lot and the 2^nd Lot together, the subject of the application, be sold by way of public auction for the purposes of redevelopment of the Lots;

(2)  Mr Chow Wing Kin Anthony and Ms Chow Shuk Han Anna, nominated by the applicants, be appointed the trustees (“the Trustees”) to discharge the duties imposed on them as trustees by the Ordinance in relation to the sale of the Lots;

(3)  The Trustees be authorised to charge such remuneration for their services in accordance with the terms set out in the letter of Messrs Guantao & Chow, Solicitors and Notaries dated 9 April 2026[10];

(4)  For the purposes of the sale of the 1^st Lot and 2^nd Lot together by public auction: -

a)  the sale of the 1^st Lot and 2^nd Lot be on the particulars and conditions of sale the same or substantially the same as those set out in the draft Particulars and Conditions of Sale[11] to be approved and initialed by the Tribunal;

b)  the reserve price be set at $580,000,000;

c)  the respective EUVs of all the properties on Lot 1 as at 15 November 2024 assessed by Mr CW Wong are fair and reasonable and the EUVs of the Respondents’ properties as at 15 November 2024 assessed by Mr CW Wong are fair and reasonable when compared with the EUVs of the Applicants’ properties as at the same date assessed by him; and

d)  The RDV of Lot 1 ($118,000,000) and RDV of Lot 2 ($229,000,000) as at 15 November 2024 assessed by Mr CW Wong are reasonable and should be accepted;

e)  The following valuation opinion of Mr CW Wong should be adopted for the apportionment of the proceeds of sale of Lot 1 and Lot 2 in accordance with s.10(3) of the Ordinance and Paragraph 2(a)(i), (b) and (c) of Part 3 of Schedule 1 thereto.

(i)  the respective EUVs of all the properties on Lot 1 as at 15 November 2024; and

(ii)  the RDV of Lot 1 and RDV of Lot 2 as at 15 November 2024;

(5)  The Applicants do publish notices once in a Chinese language newspaper (and in the Chinese language) and once in an English newspaper (and in the English language) circulating generally in Hong Kong within 7 days from the date of the sealed judgment to be made herein by the Tribunal informing R3, 1^st, 2^nd and 4^th named R5 and all persons claiming to the owners of Lot 1:-

(a)  that the Tribunal has made an Order for sale of Lot 1 and Lot 2;

(b)  that Lot 1 and Lot 2 will be sold by public auction; and

(c)  where and when a copy of the Order for sale to be made herein can be obtained.

(6)  Subject to further extensions that the Tribunal may subsequently allow upon the application of the purchaser of the 1^st Lot and 2^nd Lot or its successor in title, the redevelopment of the 1^st Lot and 2^nd Lot together shall be completed and made fit for occupation within a period of 7 years after the date on which the purchaser of the 1^st Lot and 2^nd Lot becomes the owner of the Lots; and

(7)  Liberty to the applicants, the respondents and the Trustees to apply to the Tribunal for further directions.

COSTS

75.  There be no order as to costs. Unless any parties apply by summons to vary, the costs order nisi shall be made absolute upon expiry of 14 days from the date of this judgment.

Appendix 1