History, Preservation, Architecture, and Compensation by Public

Stephen Chung

Executive Director

Zeppelin Real Estate Analysis Limited

February 2003

Lately, there have been media reports on old Hong Kong buildings potentially falling prey to bulldozers and thus followed a range of discussions on the lack of historic preservation laws and the need to protect such heritage buildings from being demolished and redeveloped. Your humble author is somewhat torn between the two ends, i.e. preservation and redevelopment, in some ways. While certain historic buildings of heritage value are worth preserving for their local sentimental element (even if they do not draw in tourists), redevelopment is also vital from an urban metabolism point of view. If all or a substantial portion of the (old) buildings were preserved, there would not be a Hong Kong as we know it, nor would your humble author be able to survive as a real estate analyst. While people who opt for preservation have perhaps the best of intentions in mind, some issues may also need to be addressed as follows:     

a)      Not all old / historic buildings are worth preserving = the fact that a building is old (in Hong Kong and commercially speaking, a building is definitely considered old if it is near or above 30 years old, and one may double that in historic terms perhaps) does not automatically imply it is worth the effort, resource, and time to preserve it. Not being an expert on historic value or building preservation, your author thinks the building has to have some historic-social-cultural-sentimental-icon connections with the local community, of part thereof. In short, its demise will have to be missed. Some people may argue that an old building may draw in tourists etc even if it does not synch much with the locals. True, but then usually the quality of that attraction will be more artificial and that some significant renovations will have to be made to the old building resulting in its original flavor, IF ANY, being lost. These apply to old buildings that are open to the public or private (closed to the public).

b)      Architectural value = people often consider the old buildings to have certain architectural value or design enlightenment. Well, some old buildings do and some do not. The fact that an old building is surrounded now by more ugly new / modern buildings does not mean its architectural value has risen, comparative value-wise perhaps, but not in its absolute value. Some old buildings might actually be the cookie cutter type in their prime days, and it is just that we now use other cookie-cutters. In short, some old buildings are not worth the praise they are given in terms of architectural value, and these would have to obtain my vote via the historic-social-cultural-sentimental-icon criteria mentioned above.

c)      Preservation / common folks versus the real estate developers / industry = some of the discussions on the topic seem to boil down the issue to a competition between preservation folks (portrayed as having a good conscience usually) and the real estate developers (with a greedy heart). This is somewhat over simplistic and regardless, good conscience and / or greedy hearts are not the main focus nor are they of much bearing to the issue and its solutions, if any. Furthermore, some folks actually like seeing new buildings and do not care that much (maybe they should but that is another topic) for preservations. Also, a few developers could be creative in mixing old and new.

d)      The private building owner and compensation = some of the discussions do not seem to take the private property owner who owns the old building into account, almost as if he / she does not exist or has to follow whatever opinion or action is decided. If preservation prevails, especially if the building is designated as such, he / she will thus have a hard time trying to do anything with it let alone redeveloping it. Nonetheless, he / she is still by and large charged with maintaining it (and old buildings could have hefty maintenance costs). This is somewhat unfair. Your humble author sees it this way: if a building, whether it is worth it or not, is to be preserved and designated as an historic-preserved building for the benefit of society or public, then the society-public should pay for having it. Your author will leave the detail technicalities / calculations to the experts though this may involve maintenance contributions, value compensation for taking away / reducing the redevelopment rights, and the like. See it this way, if I have a very expensive painting and the public wishes to view it and keep it in the museum for some time or even forever, shouldn¡¦t I be compensated in some ways? If the public have second thoughts about that or does not wish to pay a certain price for that, then the only thing stopping its redevelopment or demise would be the owner¡¦s goodwill or decision.

Some people may feel if some laws are not used to force preservations and / or if hefty compensation is required, then certain heritages could be lost, and that subsequently the public may live to regret it, albeit too late and irreversible. True, but if that is what the people choose to do (i.e. to ignore preservations), that is what they will get (potentially a city devoid of history or sentimental interest). Eventually, the public at large will have to bear responsibility for their decisions and actions (ignorance and neglect included).   

Notes: The article and/or content contained herein are for general reference only and are not meant to substitute for proper professional advice and/or due diligence. The author(s) and Zeppelin, including its staff, associates, consultants, executives and the like do not accept any responsibility or liability for losses, damages, claims and the like arising out of the use or reference to the content contained herein. 

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