Hong Kong’s worst blaze in seven decades has exposed an ugly open secret of a murky and rapacious building renovation business that is plagued by bid-rigging and skyrocketing costs even as it staves off feeble official efforts to tackle collusive conduct.
Experts and former insiders offered this grim assessment, pointing to the city as a gold mine for such syndicates given its ageing stock of high-rise properties ripe for renovation.
They made a collective call for an overhaul of the industry as the government announced on Tuesday an independent committee to investigate the cause of the deadly fire at Wang Fuk Court in Tai Po – which has claimed 156 lives so far – and to review systemic problems, including alleged bid-rigging.
Like many older buildings, the impetus to renovate at Wang Fuk Court came from an official edict. The estate was served a statutory order under a mandatory building inspection scheme in 2016. Each year, authorities require around 600 properties aged at least 30 years to hire a professional consultant to inspect the buildings and contractors to complete necessary repairs.
Internal documents reveal the renovation budget of Wang Fuk Court ballooned from a preliminary tender analysis of HK$152 million (US$19.5 million) in September 2023 to a final HK$336 million last year, after the estate adopted the most expensive option.
The renovation included the complete removal and repaving of external wall mosaics rather than patch repairs, alongside millions in added costs for drainage and fire safety upgrades.
