The Urban Renewal Authority has recorded a HK$2.3bn deficit in the last financial year, based on a report by Barclays
According to the report on the Urban Renewal Authority, the deficit was rooted to the delay in tendering for four projects that had met resistance from property owners as well as a provision for losses on five projects for which compensation offers were made.
The URA’s chairman stated that
A declining property market and construction costs which have been rising in the past four years, may also threaten the URA’s long-term financial stability.
With more new private development, infrastructure construction and a shortage of skilled labour and construction costs continuing to rise at the same pace of the 7-8% recorded in 2013, this would not seem to bode particularly well for the URA.
However, despite the gloomy near-term outlook, the URA still had net assests of Hk$23.9bn and could afford the Hk$33bn it would cost to implement its business plan for the next five years.