Lease Modification, Land Exchange and Lot Extension
Specific arrangements concerning applications by private developers or owners to the Government for modification of the lease conditions for optimization of the use of land within the statutory planning framework in general is in place. Apart from modification (including land exchange), land may sometimes be granted as an extension to a lot, if appropriate.
In modification cases which do not involve any realignment of the boundaries of the lot(s) covered by the lease concerned and are conducted by a modification letter, all the conditions previously applicable to the lease, including the lease term and the rent, will remain unchanged, with the exception of the conditions being modified.
In all other modification cases conducted by way of land exchange involving surrender and regrant of land, the new lease term will usually be 50 years from the date of grant, subject to an annual rent equivalent to three per cent of the rateable value of the property at the date, adjusted in step with changes to the rateable value thereafter, and payable from the date of grant.
The premium payable for the above modification (including land exchange) is generally equivalent to the enhancement in land value, i.e. difference between the value of the land under the previous conditions and its value under the modified conditions.
Applicants may wish refer to the following Lands Department Land Administration Office (LAO) Practice Notes:
- LAO Practice Note No. 3/1999 (formerly known as "APSS 2/99") - Offer and Acceptance of Terms for Lease Modifications, Land Exchanges, Private Treaty Grants and other Land Transactions
- LAO Practice Note No. 9/2000 - Offer and Acceptance of Terms for Lease Modifications, Land Exchanges, Private Treaty Grants and other Land Transactions
- LAO Practice Note No. 4/2001 - Attendance at District Lands Conference
- LAO Practice Note No. 4/2007 - Application Checklist for Lease Modification / Land Exchange Applications