I don’t know much about the property situation in Hong Kong, but if the government does own all the land there, chances are it was not obtained legitimately so they really have no moral claim to the land. I would say a Libertarian position supports whomever is currently occupying the land (as homesteaders) deciding who they allow on it.
Sorry for resurrecting this, but I have another question. I heard that Rothbardians don’t believe that illegitimately acquired land should be given up if the rightful owners of said land can’t be located. For example, say I inherited a large plantation which was originally built upon land that was violently cleared of Indians and then “homesteaded” through illegitimate slave labor. Under Rothbardian principle, I am still entitled to own the land and employ others to work it because no descendant of the original Indians or slaves can be established as a rightful owner. Is that a correct representation of the Rothbardian position?
If so, then it logically follows that the government of Hong Kong is the rightful owner of all of Hong Kong. Whether it acquired the land legitimately is irrelevant because the rightful owners can’t be located. Saying that the current occupants are entitled to the land would be the same as saying that the current laborers of a former slave plantation are entitled to that land.