Urban Renewal Authority 2018-19 Annual Report

21 MANAGING DIRECTOR’S STATEMENT The New Building Rehabilitation Strategy Study has interviewed owner representatives from 3,000 buildings in order to understand the difficulties they face regarding building maintenance. As reflected in the results, owners of old buildings are often faced with three mounting challenges. They are: (1) Lack of financial reserve: The Guidelines for Deeds of Mutual Covenant and the Building Management Ordinance stipulate that a special fund for building repairs should be set up by owners. Yet, in the absence of specifications on the amount and frequency of contribution, most Owners’ Corporations (OCs) do not require owners to contribute to the fund. As a result, owners are often left with no financial reserve when they are in need of building maintenance. (2) Lack of the capability to organise: Some of the aged buildings are run without any OC or owners’ organisation, and worse still, their owners are usually elderly people who have difficulty organising maintenance works and convening meetings for resolving decisions relating to the implementation of building rehabilitation works. (3) Lack of relevant knowledge on works: Most owners are unfamiliar with procedures pertaining to tender exercises and works inspections, in addition to lacking knowledge on repair works management. Working upon these findings, we will embark on the next phase of the New Building Rehabilitation Strategy Study to explore appropriate strategies for tackling maintenance-related problems and challenges for buildings of different ages. For old buildings aged 50 or above, depending on the building condition, appropriate maintenance works should be continued to upkeep the facilities and structural safety until the buildings are no longer serviceable with serious structural defects and redevelopment becomes the last resort. Of these old buildings, more than half are commonly known as “three nils buildings” which have no OCs, owners’ organisations or property management companies, and nor do their Deeds of Mutual Covenants stipulate any proper procedures for resolving matters relating to the implementation of building rehabilitation works. To help address this, the URA has appointed legal consultants to study relevant provisions governing the validity of resolutions in their Deeds of Mutual Covenants under the Operation Building Bright 2.0 and the Fire Safety Improvement Works Subsidy Scheme launched last year. This stepped up assistance from the URA has helped around 50 “3-nil buildings”, allowing their owners to take the first step to form new OCs, or to convene owners’ meetings for reaching a consensus or getting written approvals to pass a resolution in support of organising building rehabilitation under the subsidised schemes.