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Developers, Government finally agree on Yi Pak land premium

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HKR International and Citic Pacific have agreed to pay a $1.65 billion land premium for their 2.06 million square foot Yi Pak development in Discovery Bay.

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Through their 50-50 joint venture - Hong Kong Resort - the companies ended years of negotiations with the Government with the concluded premium accord on Monday.

Analysts said the settlement represented a 'reasonable price' of $798 per square foot.

The amount is comparable with the $220 million, or $817 per square foot, Hong Kong Resort concluded with the Government in February for the 269,100 sq ft Discovery Bay phases nine and 10.

HKR International said the premium payment would be financed from the venture's internal resources and bank borrowings.

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Ten per cent of the premium, $165 million, was paid and the balance will be handed over within three months.

The premium negotiations were drawn-out, said Hong Kong Resort, due to the volatility of the property market.

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