Section B: Estate Management and Rent Policy Chapter 25: Letting of Commercial Premises by Open Instant Tender (By Estate/Shopping Centre) I. Eligibility of Tenderer    1. Tenderers , if in the individual capacity, must be 18 years of age or over.             2. Tenderers, if in the capacity of a corporation, must be a limited company.             3. If any person who signs as tenderer does so as an agent or a trustee for any other person or persons, he shall disclose in his Tender Form / Application Form the names and addresses of such person or persons. If no such disclosure is made, the person signing the Tender Form / Application Form shall be deemed to be a principal and no subsequent disclosure of any trust, agencies, etc. will be recognized by Hong Kong Housing Authority.           II. Letting Arrangements           1. The commercial premises are leased under a standard three-year tenancy term. Tenderers will bid in a ballot tender and the tenancy will be granted to the tenderer who offers the highest bid.           2. A list of commercial premises available for lease with predetermined upset rent and trades are displayed at the estate/shopping centre offices concerned.       3. Tenderers must register and pay tender deposit before tendering.  Only registered tenderers are allowed to enter the venue to bid on the date of the tender exercise.           III. Basic Leasing Terms and Conditions   1. All tenancies are normally granted on a fixed term of three years without an option to renew.             2. Tenderers must occupy the premises for their own use and no assignment, sub-letting or parting with the possession of the premises or any part thereof will be permitted without the prior written approval from Hong Kong Housing Authority.             3a. The prospective tenants are allowed a rent-free period subject to the conditions set out in 3(b).  The period may range from 1 month to 3 months according to the followings:       Size of Premises Rent-free Period Less than 100m2 One month Between 100m2 - 250m2 Two months Larger than 250m2 Three months         3b. The rent-free period is to be granted subject to:- (i)   no breach of any terms and conditions of the tenancy agreement; and (ii)   no termination of the tenancy by the tenant during the period of 6 months from the commencement of the tenancy (the "Period").  If at any time during the Period there is any breach of the terms of the tenancy and the tenancy is terminated by the Housing Authority in consequence of such breach or if the tenancy is terminated by the tenant prior to the expiration of the Period, without prejudice to any other rights of the Housing Authority under the tenancy agreement, the tenant shall forthwith pay to the Housing Authority the rent for the period as set out in 3(a) above.             4. Tenderers should note that under the Tenancy Agreement, interest will be charged on the amount of rent and / or rates, air-conditioning charge, if any, in arrears at the rate of 2% per month, from the date upon which such payment fell due.             5. Tenderers should note that whenever the tenancy is terminated for whatever reasons, the tenant is required to deliver vacant possession of the premises to Hong Kong Housing Authority unconditionally, and shall not be entitled to any claim for compensation. Hong Kong Housing Authority shall have the full right to relet the premises or otherwise dispose of the premises in such manner and to such person as it may think fit, free from the interference of any person.           6. Tenderers should note that the granting of a commercial tenancy does not confer upon the tenant any exclusive right to any particular trade in the estate / shopping centre concerned, and that Hong Kong Housing Authority reserves the right to let other premises in the estate/shopping centre concerned in whatever manner for the same trade according to the needs as assessed by Hong Kong Housing Authority. Change of user of the premises during the term of the tenancy shall not be permitted without the written consent of Hong Kong Housing Authority.   7. Tenderers should note that under the terms of the Tenancy, the Housing Authority shall be entitled to transfer and assign the reversion of the premises and all the rights and obligations under the Tenancy to any third party on such terms and conditions as the Housing Authority shall think fit without any interference or any claim or demand for compensation whatsoever by the Tenant.           IV. The General Requirements for Fitting-out   1. Tenderers are advised to note the maximum electricity loading available to the premises. Should additional loading beyond the designed capacity be required, the expenses incurred in upgrading, plus on-cost currently at the rate of 28.7% as supervision charge, will be wholly borne by the prospective tenant, provided that the upgrading is approved by the Housing Department.             2. The prospective tenant shall accept the premises in the state and condition in which they are found at the date when possession is given and shall be responsible for the fitting-out of the premises to meet the requirements of Hong Kong Housing Authority and other competent authorities. All modifications to the building services installations, subject to agreement of the Housing Department, must be carried out by contractors appointed by the Housing Department. The expenses incurred in all modifications, plus on-cost currently at the rate of 28.7% as supervision charge, will be wholly borne by the prospective tenant.             3. The prospective tenant is required to submit plans for the intended conversion to the Housing Department and no conversion work shall be started until written approval is obtained from the Housing Department.             4. The prospective tenant will be allowed to install his own air-conditioning system on the premises if no central air-conditioning is provided but installation of air-conditioning plant and routing of pipe/duct and wires are subject to prior approval from the Housing Department. Besides, properly connected drainage for condensation should be provided where air-conditioning units are used.             5. No installation likely to cause disturbance to persons and properties (e.g. exhaust fan, fume-extractors, etc.) will be permitted without prior approval from the Housing Department.             6. No alteration to shop front is permitted unless approval has been obtained from the Housing Department.           7. Installation of signage outside the premises is allowed only at designated locations. The location, layout, lettering and colour scheme of the proposed signs are to be approved by the Housing Department.   8. A pre-letting meeting can be arranged upon request to answer questions from prospective tenants before submission of fitting-out plans. A guideline has been developed to help the prospective tenants to identify what types of fitting-out works would require submission to Independent Checking Unit and licensing authority. Respective Shopping Centre Manager will provide the guideline to the prospective tenants before they submit their applications. For complicated submission, a case conference can be arranged with the tenant to collate input from the different disciplines simultaneously.   9. We will vet from Landlord' s role and approve the applications for fitting-out works by 3 classes according to complexity as below. Class 1 : Simple case : No alteration of BS installations, structure, waterproofing, drainage, compartmentation, outlook of the building. To be completed within 7 days excluding Saturdays, Sundays and public holidays.  Class 2 : Normal case : Considerable amount of building works, relocation of internal partitions, forming of openings in floor or wall. To be completed within 14 days excluding Saturdays, Sundays and public holidays.  Class 3 : Complicated case : Involved major building works, additional floor or wall, installation of heavy machine or equipment. To be completed within 21 days excluding Saturdays, Sundays and public holidays.  Note: Time count will stop when reminder to call for supplementary information is sent out to tenant and resumes when full set of required information is received. V. Normal Leasing Procedures   1. In addition to the payment of the tendered rent for the first month, the successful tenderer shall be required to pay a rent deposit equivalent to two months' average tendered rent of the tenancy term on the tender day either by cheque or cashier's order.  The tender deposit may be offset as part payment of the said rent deposit.  Provided that there shall be on outstanding rent, and / or rates, air-conditioning charge, if any, or other breaches of the tenancy agreement, deposit in full, without any interest thereon, shall be refunded on termination of the tenancy.             2. The successful tenderer shall attend the interviews or execute the Tenancy Agreement whichever is applicable within the time specified in a written notice issued by the Hong Kong Housing Authority or such person as authorized by the Hong Kong Housing Authority, which time shall be not less than seven days from the date of the notice.  The tenancy shall commence and rent shall be payable from the date of the execution of the Tenancy Agreement.  In the event the successful tenderer fails for whatever reasons to attend the interviews or to execute the Tenancy Agreement within the time specified, Hong Kong Housing Authority may by notice in writing to the successful tenderer forthwith cancel the tender and the letting of the premises to the successful tenderer hereunder.  Upon the cancellation of the tender and the letting of the premises as aforesaid the entire deposit shall forthwith be absolutely forfeited to Hong Kong Housing Authority as liquidated damages and not as a penalty without any further notice and Hong Kong Housing Authority may let the premises to such other person and/or deal with the premises in such manner as Hong Kong Housing Authority shall consider appropriate, and the successful tenderer shall not have any claim whatever for compensation or refund of the deposit or in respect of the premises or otherwise against Hong Kong Housing Authority.              3. Hong Kong Housing Authority will give prior written notice to the successful tenderer to take possession of the leased premises. The date of commencement of the tenancy shall be the date on which possession of the leased premises is given.                     VI. Special Rules and Regulations   1. Hong Kong Housing Authority does not bind itself to accept any tender.             2. Tenderers are reminded that if manipulation of Hong Kong Housing Authority's letting system is discovered, and such has been proved to the satisfaction of the Director of Housing, then the said Director can at his discretion reject the tenders from such tenderers. The decision by the Director of Housing as to whether the letting system has been manipulated and as to whether the tenderers are involved in the manipulation is final.             3. No charge is made on the supply of the tender form and for the processing of tenders. Reports should be made to the appropriate authority immediately for any person purporting to offer assistance in respect of the tenders in return for a reward.             4. Any person who attempts to influence consideration of his or her tender by approaching any member of the staff of the department or by the use of any other improper means shall render his or her tender invalid.             5. Tenderers are reminded that offering or giving any gratuity, money or gift as an inducement to any employee of the Housing Department in relation to the tender constitutes an offence under the Prevention of Bribery Ordinance and such cases will be reported to the Independent Commission Against Corruption.             6. All tenders will be kept strictly confidential.

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