Grade-one historic status was proposed by the Antiquities and Monuments Office last year for the building at 139-147 Argyle Street.
The negotiation is based on an approved building plan for a 39-storey residential tower atop a four-storey car-parking podium on the site that CLP secured in 2001, which could be worth billions of dollars, a person in the heritage-conservation field said.
A CLP spokeswoman confirmed the utility had had discussions with the government on "the need to balance between preservation of built heritage for the benefits of the community and allowing individual owners such as CLP to exercise the rights that come with ownership". "We are constantly reviewing our need and requirement for our properties and currently reviewing various options for our head office building," she said.
A top government official said it was having talks with a grade-one heritage owner, without giving a name. "If negotiations bore fruit, the case would be another example in which the government managed to secure preservation of privately owned heritage by handing out economic incentives instead of buying out with cash," the official said.
The art deco building was opened in 1940 as the utility, led by the Kadoorie family, extended the electricity supply for a growing Kowloon.
It marked a milestone in the development of the company and the district, according to a heritage appraisal by the antiquities office.
The two sides have been exploring several options to keep the block without affecting the owner's development rights. One possibility is partial preservation with new structures, as was done with the Wan Chai Market, with only the facade kept and the rear demolished for flats.
But this approach would impair the integrity of the symmetrical CLP building, architectural conservationist Dr Lee Ho-yin said. The block, standing on a landscaped embankment at a major junction of roads and flyovers, has long been a landmark.
Another option is for CLP to transfer the surplus development potential to another site it owns or one granted by the government. The present head office contains a gross floor area of about 78,000 square feet, according to the building plan. The 2001 plan would enable CLP to develop a residential tower with a floor area of about 309,000 square feet. This means the transfer could involve the unrealised 231,000 square feet.
Surveyors say the greatest challenge for this option is to find a suitable site. "You have to look for a site in the area large enough to receive the unrealised building space. There are very few such sites in Ho Man Tin and Kowloon Tong, except a site in Ede Road in the [government's] land sale list," SK Pang managing director Pang Shiu-kee said.
Building density in the area had already been capped, adding to the difficulty, he said. An attempt in 2000 to raise the plot ratio in Kadoorie Hills behind the headquarters block was rejected by the Town Planning Board, which wanted to maintain the "high-class low-density" scenic setting in the area.
Charles Chan Chiu-kwok, managing director of Savills Valuation and Professional Services, said the two sides could also be split on land values of the Argyle Street site and the transfer site. Officials would have to be careful in the calculations.
He estimated the CLP site could be worth HK$13,000 (RM5,207.36) per square foot.
Donation of the site to the government in exchange for another — as in the case of King Yin Lei mansion in Stubbs Road, Mid-Levels — sounds a less likely option for the company, which has maintained the head office there for almost 70 years.
The Development Bureau has in recent years given economic incentives to other private owners of heritage buildings.
It is working out a plan with the Anglican Sheng Kung Hui so the church can transfer some development rights from its compound on Lower Albert Road to a Mt Butler site that it owns. It allowed owners of Jessville in Pok Fu Lam Road to build two residential towers next to the 77-year-old mansion by lifting a moratorium on denser redevelopment in the area. The latest case is in Prince Edward Road West, where the owner of a four-storey shophouse is being allowed to keep the facade and demolish the rear to build a hotel.
CLP is not new to real estate development, having turned a Hung Hom power plant into Laguna Verde with Cheung Kong Holdings in the 1990s.
Antiquities Advisory Board member Dr Ng Cho-nam said the government would have to justify the deal if it decided to give incentives involving a land exchange. "It seems that society is yet to form a consensus that the building is worth preserving with such a large-scale effort," he said. — South China Morning Post
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