When private land has to be acquired for public use, usually for public works projects, it may be acquired through negotiations or by resumption under the relevant ordinances. The ordinances provide for compensation to be paid for the value of the property resumed as at the date of acquisition and for loss of business. If agreement cannot be reached on the amount of compensation to be paid, either party may go to the Lands Tribunal for adjudication. As an alternative to statutory compensation, there is a simplified assessment procedure for early release of payment to landowners to facilitate clearance of the land.

Some 82 500 square metres of private agricultural land were acquired in 2006 for public works projects mainly for drainage, sewerage and village access roads. A total of $151 million was paid as compensation during the year.

The Lands Department was also involved in the resumption of land for urban renewal projects undertaken by the Urban Renewal Authority and the Hong Kong Housing Society. During the year, compensation totalling $391.74 million was paid to owners of 136 resumed properties and occupiers affected by 18 urban renewal projects in Mong Kok, Tai Kok Tsui, Sham Shui Po, Sai Ying Pun, Wan Chai, Shau Kei Wan, Tsim Sha Tsui and Tsuen Wan.

The Lands Department also continued to resume and clear land for the Kowloon-Canton Railway Corporation for its railway projects. By year-end, $17 million had been paid as compensation for land resumed for the West Rail project and $10 million for the East Rail Extension project which includes the Sheung Shui to Lok Ma Chau spur line and the Hung Hom to Tsim Sha Tsui line.