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In response to media enquiries on a press statement issued by the Civic Party on May 29, and an article in the latest issue of "A45" published today (June 1), a spokesman for the Government said the following:
The Government earlier dismissed on May 24 as "erroneous and misleading" comparative data prepared by Dr K C Wong on the unit construction costs for the proposed Tamar development project and for the International Finance Centre (IFC) Two. The party issued a press statement, saying that it was a "groundless accusation". In the "A45" article, it continued to suggest that the estimated cost for the Tamar development project is higher than the cost of IFC Two.
The spokesman said that the comparative analysis was not premised on solid grounds and as such, the Government could not accept its conclusions.
"The fact that the Tamar development project includes a two-hectare open space has been spelt out clearly on many occasions.
"It was repeated in the government submission which Dr Wong was meant to have taken into account in his analysis, i.e. the paper referenced CB(1)1561/05-06(01)," he said.
The Government has also explained on many occasions, whereas the estimate for the Tamar project would need to cover the scope of the entire project, open space and other things included, the unit construction cost relates only to the cost for "building" and "building services" for the new Legislative Council (LegCo) Complex and government headquarters. This was explained in paragraphs 7 and 8 of the above-referenced paper.
Against the foregoing, the Government disputes the Civic Party's claim that "[n]owhere was it mentioned that the construction cost given covers the adjacent 2-hectare open space". The Government notes that the Civic Party has relied on paragraph 6 of the above-referenced paper to justify its claim but has completely overlooked the two immediately-subsequent paragraphs 7 and 8 which are relevant to the calculation of the unit construction cost.
Indeed, paragraph 6 of the paper is on the calculation of plot ratio rather than unit construction cost. The piecemeal and haphazard approach does not speak much of the due diligence checking expected of the comparative analysis.
As the Government has set out in the paper for the LegCo's Public Works Subcommittee (PWSC) and explained at the meeting on May 29, the estimated unit construction cost for the new LegCo Complex and government headquarters (about $11,600 per square metre ) would be lower than the market comparator for Grade A office buildings (about $13,000 per square metre).
"The basis of the Government's unit cost calculation aligns with the practice of the construction industry. As for the open space, paragraphs 41 and 42 of the PWSC paper have explained that the relevant cost estimates include the expenditure on drainage, external works and landscaping works," the spokesman said.
The Government observes that the Civic Party has adjusted its estimate of the unit construction cost for the Tamar project. The revised methodology assumes that by deducting from the project cost the estimates for drainage, external works, landscaping works and contingency provision, the remaining estimate would then be the basis for deducing the unit construction costs. This overlooks the industry practice for comparing unit construction cost - which typically does not take into account fitting-out works, site works, basement, and footbridges.
Moreover, it is industry practice to apply construction floor area (CFA) instead of gross floor area (GFA) in the calculation of unit construction cost.
The Government would stand ready to explain to the Civic Party and Dr Wong the basis of our calculation for the Tamar development project and how the Government has drawn reference from the regular professional surveying updates published by Levett & Bailey and Davis Langdon & Seah, the spokesman added.
Ends/Thursday, June 1, 2006
Issued at HKT 20:31
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