In recent years, while there has been a serious shortage of land for housing, the demand for offices, hotels and other commercial facilities has been increasing. As prices and rent levels for various properties keep rising, the business environment for small, medium and large enterprises as well as the community’s living environment has been affected, and Hong Kong’s competitiveness has been weakened. Land use review is one of our multi-pronged measures to increase land supply, which can optimise the use of our precious land resources to keep pace with the times. One of the measures is to review industrial sites for rezoning those which are vacant or under-utilised to other uses, thereby through redevelopment or wholesale conversion releasing their development potential and providing suitable floor space to meet Hong Kong’s social and economic needs.
In this regard, not all industrial sites are suitable for rezoning to residential use. For example, even if industrial activities are no longer carried out in an industrial building, such activities may still be carried out in adjacent industrial buildings. If the site where the industrial building is situated is rezoned to residential use, the air-quality and noise requirements may not be met. In view of this, we can consider rezoning the site to commercial use, so that the building can be used as office, hotel and other commercial facilities through redevelopment or wholesale conversion. With a central air-conditioning system in place, it is not necessary to install openable windows at these facilities, so the problem of incompatibility with the surrounding environment will not arise, and the site can be “revitalised”. In 2009, the Government launched measures for the revitalisation of industrial buildings to facilitate redevelopment or wholesale conversion of these industrial buildings, with a view to coping with the market demand for offices, hotels and other commercial facilities.
In his 2013 Policy Address the Chief Executive announced that the Government will further refine the existing measures to better facilitate revitalisation of industrial buildings in appropriate land use zonings into non-industrial uses. These measures are not big moves. They seek to respond to the technical and practical difficulties raised by applicants over the past few years. On premium, we will nonetheless not offer any concessions.
The key refined measures include the following:
(A) Regarding the measure to encourage wholesale conversion of industrial buildings,
(1) if conversion of an industrial building leads to a loss in the total gross floor area (GFA), subject to the limit of up to 10 per cent of the total GFA, the owner may recover the amount of GFA loss due to conversion by building outside the existing building frame, on the conditions that the building height restrictions and site coverage limits under the relevant regimes are complied with. If lease modification is required for carrying out conversion works, the fees and the building height restriction under the land lease may be waived where appropriate;
(2) for the placing of utility installations not exceeding 50 per cent of the roof area, building height restriction (and fee) under the land lease may be waived; and
(3) installation of claddings or curtain walls for industrial buildings within the lot boundary may not be permitted under the land lease. The Director of Lands may, at his/her discretion, approve lease modifications to allow the installation of cladding or curtain walls protruding beyond the lot boundary on Government land, but not on any private lot.
(B) Regarding the measure to encourage redevelopment of industrial buildings, if the redevelopment is for hotel use, owners of industrial buildings on non-industrial zones may opt for payment of the premium by annual installments for up to five years.
The Lands Department (LandsD) is drawing up a practice note for the above refinements, which are expected to come into effect in April next year. The application period for the revitalisation measures will end on March 31, 2016.
The Government announced in October 2009 a series of measures to facilitate redevelopment and wholesale conversion of old industrial buildings. These measures took effect in April 2010. In September 2011, the Government completed a mid-term review of the revitalisation measures, and subsequently introduced a number of refinements to allow greater flexibility for wholesale conversion. By the end of October this year, the LandsD had received 115 applications and approved 82 of them. We hope the additional refinements listed above could facilitate the revitalisation of industrial buildings to meet the demand for buildings and facilities of various uses.
10 November, 2013
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