Hang Lung’s acquisition of the Shouson Hill Village Road project of the US Consulate General in Hong Kong has hit the rocks as it is embroiled in the Sino-US row! Hang Lung announced at noon that the company received a letter from the Land Registry through its legal counsel last Monday (21), stating that the U.S. Consulate General in Hong Kong is not an ordinary commercial entity and 37 Shouson Hill Village Road is not an ordinary property; the sale of the property involves diplomatic affairs between the U.S. and China and is not an ordinary commercial act; the U.S. government needs to apply to the Chinese government through the Ministry of Foreign Affairs 60 days in advance and receive a written reply The U.S. government must submit an application to the Chinese government 60 days in advance through the Ministry of Foreign Affairs and receive a written response before it can be registered with the Land Registry.
The U.S., through legal counsel, objected to the request, but did not provide proof as requested in the request letter. In the letter, the United States stated, first, that it had complied with its obligations and responsibilities, second, that the diplomatic obligations associated with the sale of the property were an inter-sovereign matter and did not affect the title to the property, and, further, that the Land Registry had no authority not to register the Memorandum of Agreement.
Nonetheless, the United States accepted the Land Registry’s position, as stated in the letter, that the Property was “not ordinary property” and that the transaction was “not an ordinary course of business” and that the sale of the Property “involves diplomatic matters and should be handled in accordance with applicable diplomatic norms. As a result, the transaction was not completed on or before noon today as originally scheduled.
According to Hang Lung, for the reasons stated above, the completion of the transaction involves a diplomatic matter between two sovereign states, China and the United States, and is therefore beyond the control of Hang Lung Properties and the bidder. Hang Lung Properties and the bidder are evaluating and consulting with legal counsel as to the appropriate actions that may be taken in connection with the transaction, including examining the possibility of extending the time for completion. The reporter asked Hang Lung about the actions that could be taken, including tarting risks, etc., Hang Lung spokesman responded that no further information was available. A spokesman for the U.S. Consulate replied that both the buyer and seller need more time to process the transaction, but the Consulate is not at liberty to comment on the ongoing transaction.
The U.S. government sold the U.S. consulate quarters at 37 Shouson Hill Shouson Village Road in the middle of this year under the “restructuring of overseas asset allocation”, the land was purchased by the U.S. government in 1948 and has been used as the U.S. consulate quarters in Hong Kong.
The final purchase by Hang Lung with 2.566 billion yuan, into the market expected lower price, the market described Hang Lung “flat executive” luxury residential land, per square foot floor price of only more than 50,000 yuan, compared to two years ago China Resources Land (1109) threw 5.9 billion yuan to Zhou Shoushen family purchased Shoushen Village Road 39 house land, floor price 85,847 yuan, the land price fell nearly 40%, Hang Lung can be said to shoot price to win Shoushen Hill land. The property is now 6 low-density residential buildings, providing 26 units and 52 parking spaces, in addition to an outdoor swimming pool, the site area of about 94,796 square feet, redevelopable area of about 47,397 square feet.
Industry: “Political overtones” override business deal
Shouson Hill former U.S. Consulate dormitory, with unbeatable sea views, coupled with the lack of supply in the area has always been a rare release. However, this time the property sale involves the diplomatic affairs between China and the United States, Su Zhenxian surveyor firm managing director Su Zhenxian said, never heard of the case due to diplomatic issues and give up the sale of land, this is also the first case, but I believe that the relevant people have assessed the legal risks, or both sides do have diplomatic restrictions, but the relevant issues are too complex to comment. The market believes that the Hang Lung Group’s purchase of the Shoushan Village Road property, “political overtones” override the commercial transaction, the relationship between the United States and China will become the key to the transaction.
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