Hong Kong Link REIT Survives Late Legal Challenge
Hong Kong’s High Court has dismissed a last minute legal challenge to the
government’s sale of more than HK$30 billion in real estate, allowing the
Link Reit (real estate investment trust) listing to go ahead as planned.
The judicial review of the sale was brought by an elderly Hong Kong couple
who claimed that the government had breached the city’s housing code and
failed to provide alternative accommodation and amenities to residents. The plaintiffs were also backed by opposition lawmaker Albert Cheng, who has
criticised the authorities for selling off the property inventory, which includes
180 car parks and almost one million square metres of retail space, too cheaply. The rejection of the plaintiffs’ substantive application by Justice Michael
Harman clears the way for the listing to take place on the Hong Kong Stock Exchange,
which is scheduled for today. However, the ruling has left the door open for a possible appeal of the Link
Reit’s structure in the Appeals Court, and reports indicate that the episode
has merely served to sow seeds of doubt among many investors over the future
of the listing - not least its chief architects, HSBC, Goldman Sachs and UBS
Investment Bank. "We welcome the court's decision," commented Mary Li, the Housing
Authority's spokesperson. "But we have to wait to see whether the petitioners will appeal before
we say our listing date is on schedule," she added. A comprehensive report in our Intelligence Report series examining offshore investment, offshore stock exchanges, and hedge funds is available in the Lowtax Library at http://www.lowtaxlibrary.com/asp/subs_reports.asp and a description of the report can be seen at http://www.lowtaxlibrary.com/asp/description_report9.asp
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