Local officials turned blind eye to demolition without permits

The local subsidiary of a major Hong Kong property developer has forced hundreds of residents of a central Guangzhou neighborhood from their homes to make way for a new building complex without providing required paperwork to the authorities, RFA's Cantonese service reports.

The project has forced hundreds of people from about 300 homes on the original site since 1997. Residents have also been told conflicting stories regarding how the land was to be used, which could affect their legal rights to the property or compensation for it.

The firm behind Tongfu Garden (Fortune Garden Development Project) is Henderson China Holdings Ltd. Henderson China is a spinoff from Henderson Land Development Co. Ltd., one of Hong Kong's three largest property developers. Henderson Land Development began investing in China's real estate market in the early 1990s, and in 1996 it listed Henderson China on the Hong Kong Stock Exchange.

The planned Tongfu Garden project is located in Guangzhou's upscale southern Central Haizhu District, on Nanhua East Road, Tongqing Road, and Tongfu Middle Road. From 1997-2001, Henderson China's annual reports said the company planned to develop the site, called the Tongfu Garden Project into a 32-storey office tower and eight 30-storey residential towers above a three-storey retail podium.

In 1993 and 1996, the Guangzhou municipal government's Real Estate Management Bureau issued permits to Henderson China's registered agent Jian Heng Property Co. to begin resettlement and site clearance work. In 1997, Jian Heng Property dismantled most homes on the site through an intermediary company that was negotiating compensation deals with evicted residents.

Developers and government departments in China often use specialized eviction companies to put pressure on residents. Their apparent distance from the government enables them to use coercive and sometimes abusive tactics to 'persuade' residents to leave. In this case, no compensation deal was reached, and local authorities were present while residents were forced from their homes.

But documents obtained by RFA's Cantonese Service indicate that in 1997 and 2000, several Guangzhou government agencies contacted Jiang Heng Property to complain that it had failed to submit necessary property transfer and settlement documents to the authorities, an oversight which could invalidate the legal basis for the government's actions.

Letters from the Guangzhou Land & Resources Bureau, Real Estate Management Bureau, and Town Planning Bureau say Jian Heng hadn't completed necessary procedures for land use permits and resettlement compensation. It also failed to sign transfer documents required to obtain building permits. Buildings without permits can be condemned for demolition by city authorities.

Reporters who phoned Henderson China to inquire about the Tongfu Garden project were told repeatedly that no one with any knowledge of the project was in the office.

Local laws give residents the right move back to the original site from which they were moved if the land is developed for commercial or residential purposes. But in an apparent bid to circumvent this law, local officials told residents that the Tongfu Garden site would be used to expand the Jiefang Bridge�even after the Guangzhou Real Estate Management Bureau announced in 1997 that Tongfu Garden would be built into a financial, commercial, and residential complex.

"Guangzhou government officers told us this was a government project, a building for the [expanded] Jiefang Bridge," said one woman, a Ms. Zhan, who continues to live with her husband in one of the few homes on the site that remain standing. "Many residents thought this was a city project, and they were afraid of the government so they moved� But the Jiefang Bridge finished its expansion before 1997, right in front of my house, so I knew they weren't telling the truth."

Most residents of the old structures were moved to Xin Ya Garden, a development about 10 kilometers outside the city. Xin Ya Garden is owned by Guangzhou Nan He Real Estate Co. Ltd.�although a local court ordered it to auction off Xin Ya Garden in 2000 because Guangzhou Nan He Real Estate Co. Ltd. had to pay off its debts.

Ms. Zhan and her husband continue to file legal complaints in a bid to hang onto the home their family has owned for some 80 years. The courts have so far rejected their appeals, she said.

Other residents have also sued and obtained contradictory results, with some told they could move into the new property while others were told they didn't qualify for resettlement in the new complex.

"Some people had their houses destroyed, and the courts said they couldn't move back," said one resident who gave only her surname, Liu. "Some held onto their property, and the court said they could come back when the construction was finished. It's the same developer, same piece of property, same permit, so why do people get different verdicts?"

Henderson China has listed Tongfu Garden Development Project in its annual report since 1997, saying initially that it would be completed in phases. The company continues to postpone the expected completion date and indicated in its 2002 annual report that, based on the city's new development plan, it has scaled back the size of the project from 414,000 square feet to 66,425 square feet.

Officials in the Guangzhou municipal government and Haizhu District, where the project is located, repeatedly declined to comment on the development.

The requisition of land by local governments and state-owned enterprises has become one of the most controversial topics in both urban and rural areas as new roads, factories, and housing and office developments have sprung up nationwide.

Local residents evicted from their homes often complain of poor government compensation and forceful removals, while many accuse the government of cashing in on the real estate market at their expense. Some residents' groups have lodged class-action suits against local governments and developers.

Chinese attorneys and legal scholars have denounced the now-widespread aggressive demolition and relocation practices as government-sponsored thuggery, which China's weak judicial system is failing to check.


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