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Legislative Council Question 2 : "Problem of factory building units being left vacant and misused" by the Hon Wong Ting-kwong and a reply by the Secretary for Housing, Planning and Lands, Mr Michael Suen, in the Legislative Council

Following is a question by the Hon Wong Ting-kwong and a reply by the Secretary for Housing, Planning and Lands, Mr Michael Suen, in the Legislative Council today (November 8):

Question:

Regarding the problem of factory building units being left vacant and misused, will the Government inform this Council:

(a) of the respective numbers and areas of factory building units owned by the Government and the private sector at present, as well as their respective utilisation rates and the number of cases in which such units were used for residential purposes in the past two years;

(b) whether it has assessed if the implementation of the Mainland and Hong Kong Closer Economic Partnership Arrangement can improve the vacancy level of factory buildings in Hong Kong; if it has, of the results; if it has not, the reasons for that; and

(c) whether it has studied ways to improve the situation of factory building units being left vacant and misused, and whether it has explored relaxing the restrictions on the uses of factory buildings, including introducing amendments to the definition of "factory" under the Factories and Industrial Undertakings Ordinance (Cap. 59), and further expanding the scope of permitted uses of industrial buildings specified by the Town Planning Board; if so, of the results; if not, the reasons for that?

Reply:

Madam President,

My reply to the three parts of the question is as follows:

(a) At present, there are 10 factory estates under the Housing Authority (HA). Excluding those old factory buildings which are soon to be demolished and thus not put up for rent, the HA provides more than 8,200 units, with total internal floor areas of over 200,000 square metres. The utilisation rate of the factory buildings of the HA reached 97% in the past two years. During the same period, the HA had not found any case in which their factory buildings were used for residential purposes.

According to the Rating and Valuation Department (RVD), as at the end of 2005, the total internal floor areas of the private flatted factories were over 17.468 million square metres, and the utilisation rate reached above 90%.

In the past two years, the Lands Department found that 57 units of the relevant factory buildings were used for residential purposes.

(b) In 2004, the Administration conducted a study on the impact of the first phase of the Mainland and Hong Kong Closer Economic Partnership Arrangement (CEPA) on the Hong Kong economy, and the findings of the study were reported to the Legislative Council in April 2005. The findings showed that 4% of the responding companies expressed that there had been an increase in the area of premises used for business operations, and that 5% would expect an increase in 2005. Another study on the impact of CEPA on the Hong Kong economy is being carried out by the Administration and the findings will be reported to the Legislative Council in 2007.

(c) With the structural transformation of Hong Kong industry, the industrial activities have been shifted from manufacturing and production-oriented to more diverse management/service-oriented and information based. To tie in with the development, the Town Planning Board (TPB) introduced a number of measures in the past decade to meet the transformation.

The measures include expanding the definition of "Industrial Use", which includes activities in which articles are manufactured, altered, cleansed, repaired, ornamented, finished, adapted for sale, broken up or demolished or in which materials are transformed, or where goods and cargo are stored, loaded, unloaded or handled, or where the training, research and development, design work, quality control and packaging related to the above processes are carried out.

Permitted uses in the "Industrial" zone now include "office related to industrial use", "IT and telecommunications industries" and "research, design and development centre" related to industry.

The TPB also introduced the "Other Specified Uses (Business)" zone, specifying that non-polluting industrial, general office and commercial uses are permitted in this zone, which has increased the flexibility in the use of industrial land. Since 2001, 246 hectares of land and land originally zoned as "Industrial" have been rezoned to other land uses, including "Business", "Residential", "Comprehensive Development Area" and "Commercial".

The Planning Department will continue to monitor the supply and demand of industrial land as well as the situation regarding the use of industrial buildings, and will consider measures from the land use planning front as appropriate when the needs arise.

Meanwhile, the Lands Department has allowed users of premises designated for industrial use to change their industrial buildings into other suitable uses through application for short term waivers. Each application in general takes only three to five months to complete.

The Factories and Industrial Undertakings Ordinance aims at safeguarding the occupational safety and health of employees working in factories and industrial undertakings, but not at specifying the user restrictions on factory building units. Whether to relax the user restrictions on factory building units to facilitate their conversion into other uses does not fall within the coverage of the Ordinance.

Ends/Wednesday, November 8, 2006
Issued at HKT 13:05

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