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Tue, Dec 21, 2004 - Page 12 News List

Hong Kong halts plans for REIT


The Hong Kong government said on Sunday it will not go ahead with plans to list shares of its US$3 billion real-estate investment trust on the territory's stock exchange because of legal uncertainties.

"In the interest of several hundred of thousands of investors, the Housing Authority decided that the listing of Link REIT will not proceed as scheduled on Monday," said Secretary for Housing, Planning and Land Michael Suen (孫明揚) at a news conference late on Sunday.

However, he said the government will relaunch the offering once the legal obstacles were resolved. He did not say when that will take place. The listing has been held up by a lawsuit alleging that Hong Kong's Housing Authority illegally sold its parking lots and retail shops to Link REIT.

A court last week dismissed the case, but the government delayed the listing to yesterday from its initial date of last Thursday, hoping to end the legal tussle.

The lawsuit was filed by two elderly public housing tenants, who questioned whether the sale of the Housing Authority's parking lots and retail shops violated Hong Kong's housing code.

One of the tenants has said he would not appeal, but it was unclear on Sunday whether the other tenant, 67-year-old Lo Sui-lan (盧少蘭), would do so within the 28-day period required by law.

"As we don't know whether the applicant [Lo] will appeal in the Court of Final Appeal, the legal complications remain, and so it may not be in the best interest of the market and investors to go ahead with the listing," Suen said.

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