No sacred cows in Hong Kong quest to ease home supply crunch


  • Property
  • Wednesday, 28 Feb 2018

Tight supply: A pedestrian walks past residential buildings at the Metro Town development in Hong Kong. Residential use accounted for just 6.9 of Hong Kong’s roughly 111,100 ha of land in 2016. — Bloomberg

HONG KONG: Hong Kong’s leaders are leaving no stone unturned in their quest to unlock more land for homes.

Golf courses, amusement parks and container ports are all being studied as sources of potential land supply by chief executive Carrie Lam’s government, which is seeking ways to solve a chronic housing shortage.

The tight supply of housing has helped fuel soaring prices in the world’s least affordable city, where taxes and mortgage curbs have failed to cool the market.

The potential seems vast: Residential use accounted for just 6.9% of Hong Kong’s roughly 111,100 ha of land in 2016, the most recent figures available from the city’s Lands Department. Although urban centres in the city are among the densest in the world, about three-fourths of its land mass is made up of open spaces.

Yet, the government’s policy of controlling the amount of new land it makes available to developers – which enables it to earn billions of dollars per year in revenue – creates an artificial scarcity of supply that results in ever higher land prices.

And developers say they also face a thicket of regulations in converting private land they purchase into use for residential purposes.

Lam last year appointed a task force to help boost land supply, saying at the time that a public consultation period would start at the end of March.

Here are potential sources of new supply under consideration by the task force:

Reclamation

Reclamation accounts for about 6% of the territory’s land. Stanley Wong, chairman of the task force, said the approach could create as much as 1,400 ha of additional land by 2030, including a 1,000 ha man-made island called East Lantau Metropolis that could house 700,000 people.

Country parks

Another proposal is to build public housing on the peripheries of country parks, which account for almost 42% of land area. The Hong Kong Housing Society plans a feasibility study this year but the government has not made its position on this clear, said Wong.

This idea has been unpopular with conservationists. Paul Zimmerman, chief executive officer of urban advocacy group Designing Hong Kong, said the plan would undermine the unique strength of Hong Kong: Access to absolute wilderness that’s rare in a major city.

“Parks should be treated as special assets and we believe this plan is very dangerous and should be at the bottom of the list,” he said.

Golf courses and Disneyland

The historic Hong Kong Golf Club, located on 172 ha in Fanling could be bulldozed to make way for a many as 13,200 homes if the government decides not to renew its lease in 2020 on a site occupied since 1911. Public consultation on the fate of the club, home of the UBS Hong Kong Open, begins at the end of March.

Another option, from a think tank called Global Institute for Tomorrow, proposes that the 60 ha reserved for expansion of Hong Kong Disneyland – which just reported its third consecutive year of losses -- could be used to provide housing for 39,900 families.

Farmland

Sun Hung Kai Properties Ltd, Henderson Land Development Co, New World Development Co and CK Asset Holdings Ltd are sitting on land banks holding more than 1,000 ha of unused farmland.

These could yield 500,000 new homes over the next 25 years, according to CLSA Ltd’s CEO Jonathan Slone.

Container ports

Hong Kong, home to one of the world’s busiest ports, could free up some 390 has of land by relocating the Kwai Tsing container terminal – some eight miles north of the city centre – to a more remote location, according to the task force.

Brownfields

Revamping use of so-called brownfield sites on private land in the New Territories, currently occupied by a smattering of open air storage facilities, warehouses and carparks, could free up 1,300 ha. — Bloomberg

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Business , Hong Kong , land , home

   

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