New World Development has agreed to preserve the State Theatre Building for its historical value as the Hong Kong developer prepares to acquire the rest of the site under a multibillion-dollar redevelopment plan.
The 68-year old theatre on 277-291 King’s Road in North Point was classified as a Grade 1 historic building in 2017.
The Hong Kong developer, controlled by Hong Kong’s third-richest family of Henry Cheng Kar-shun, has won the government’s approval to launch a compulsory acquisition of the rest of the property it does not already own, after building up more than 80 per cent of the property over the past five years.
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“In the redevelopment of the State Theatre Building, the group will closely communicate with stakeholders and community members on how to preserve the essence of the former State Theatre after the group has successfully unified the ownership,” NWD said in a statement.
The news comes as a relief for historians and local community members, who in 2015 raised concerns about the fate of the 1,400-seat State Theatre, with its unique “parabola-like” concrete arches above its roof, when news began circulating that NWD was buying up ground-floor shops of the property.
The State Theatre, which showed its last reel of films in 1997, has since evolved into a neighbourhood shopping centre. A company spokesperson has allayed those worries, saying the group has a long-standing interest in promoting arts and culture.
The city’s Lands Tribunal approved an application from NWD to force a compulsory sale of the State Theatre Building, which also includes residential and commercial units, at a reserve valuation of HK$4.77 billion, according to the government document released on Monday.
It would be Hong Kong’s biggest compulsory sale by value to be granted by the Lands Tribunal, according to JLL, higher than Henderson Land Development’s HK$2.99 billion price tag for Merry Terrace on Mid-Levels in 2014.
Under Hong Kong’s Land Compulsory Sales for Redevelopment Ordinance, property developers can apply for a compulsory auction to buy the remaining stake in a building in which they already own at least 80 per cent stake. The ordinance, however, only applies to buildings more than 50 years old to encourage urban renewal.
The proposed valuation of HK$4.77 billion for the State Theatre Building works out to about HK12,468 per sq ft in average land cost, based on the site’s total gross floor area of about 383,000 square feet, according to the Lands Tribunal.
“This is a very good price [for the developer],” said Vincent Cheung, managing director of Vincom Consulting and Appraisal, given that new residential units in the surrounding areas are fetching about HK$37,000 per square foot. “Luxury apartments could be priced at more than HK$40,000 per sq ft. But preserving the State Theatre would be costly.”
Besides retaining the State Theatre, NWD is expected to demolish two dilapidated residential buildings, built in 1959, under its redevelopment plan, a company spokesman said. “Most units are empty now.”
NWD will actively explore the feasibility of preserving relevant parts of the former State Theatre, after acquiring 100 per cent ownership and conducting a thorough inspection of the present condition and structure, the company said.
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