LCQ9: Revitalisation of old industrial buildings

Following is a question by the Hon Andrew Leung Kwan-yuen and a written reply by the Secretary for Development, Mrs Carrie Lam, in the Legislative Council today (May 19):


The Government has implemented measures since April this year to revitalise old industrial buildings by processing centrally applications for redevelopment or conversion of industrial buildings, with a view to injecting new impetus into the development of old industrial areas and the cultural and creative industries of six economic areas where Hong Kong enjoyed clear advantages. It has been reported that at present, some industrial building owners intend to, after submitting applications for revitalising and converting their old buildings for commercial use, set aside certain units for lease to artists for cultural and creative industries purposes. In this connection, will the Government inform this Council:

(a) whether it has compiled statistics on the current number of artists whose studios are located in industrial buildings in old industrial areas; whether it has contacted the artists who at present cluster at the industrial buildings in old industrial areas such as Cheung Sha Wan, Kwun Tong, San Po Kong and Fo Tan, etc., so as to gauge the impact of the measures to revitalise old industrial buildings on them; if it has, of the details;

(b) whether it will assist artists in making contact with the aforesaid owners who intend to set aside some units in their converted industrial buildings for use by cultural and creative industries, so as to assist the artists to move into the revitalised units;

(c) whether it has planned to implement appropriate measures (e.g. the provision of rates or tax concessions), so as to attract more industrial building owners to lease more converted units to artists for use as studios;

(d) how the Government's plan to inject $3 billion into the Arts and Sport Development Fund will assist the arts and cultural sector in capitalising on the development opportunities arising from measures to revitalise old industrial buildings, so as to achieve a win-win situation; and

(e) whether it will consider relaxing the existing vetting and approval criteria for converting industrial buildings in old industrial areas into venues for arts performances such as music or drama, etc.?



In his Policy Address delivered in October last year, the Chief Executive announced a package of new measures to release the potential of old industrial buildings by encouraging building owners to carry out redevelopment and wholesale conversion. These measures were formally implemented on April 1 this year. A dedicated team has been set up at the headquarters of the Lands Department to centrally process applications for special waiver for wholesale conversion of industrial buildings, as well as applications for lease modifications for redevelopment of industrial buildings under the new measures.

Since the announcement of the new initiatives, Development Bureau (DEVB) has explained the measures to various business groups, professional bodies, local administration bodies and other stakeholders, and listened to their views, including groups and individuals engaging in cultural and creative industries. To address the concerns of the cultural and creative industries over the new measures to revitalise industrial buildings, DEVB and the relevant bureaux and departments have further considered ways to assist groups and individuals engaging in cultural and creative industries who may be affected during the transition period after implementation of the new measures so as to provide support to the industries.

My reply to the five-part question is as follows:

(a) The Planning Department conducted the latest "Area Assessments of Industrial Land in the Territory" in 2008-09. Comprehensive and sample surveys have been carried out with regard to the uses of industrial buildings situated in "Industrial" and "Other Specific Uses (Business)" (OU(B)) zones respectively. The findings show that among the units successfully surveyed, less than 1% were used as "Art/ Music/ Film studios".

In addition, the Hong Kong Arts Development Council (HKADC) will soon conduct a "Survey on the Current Status of Industrial Buildings for Arts Activities and Future Demand". The survey will, among other things, look into the number and distribution of arts groups and arts practitioners who are currently using industrial premises with a view to understanding their current situation and needs. It is expected that the survey will be completed by the end of this year.

(b) We understand that some operators in the cultural and creative industries are concerned that during the transition period after implementation of the new measures, some owners intending to carry out redevelopment or wholesale conversion of industrial buildings may not renew the lease upon expiry; rental may rise as a result, making it difficult for them to continue to operate in industrial buildings. DEVB is encouraging some industrial building owners who intend to apply for wholesale conversion to demonstrate their commitment to corporate social responsibility by setting aside part of the floor areas in their converted buildings for leasing to operators in the cultural and creative industries who may be affected by the new measures. These floor areas would be leased at a concessionary rental during the transition period after implementation of the new measures as support for the local cultural and creative industries. These private organisations would participate in this scheme on a voluntary basis as an act of corporate social responsibility. The tenancy agreements signed under this scheme will be private tenancy agreements between the participating owners and the cultural and creative industry operators who apply for renting of the converted units. DEVB will be responsible for disseminating information about the industrial buildings participating in this scheme so that cultural and creative industry operators may contact the building owners direct to discuss leasing matters.

(c) The objective of the new measures to revitalise industrial buildings is to release the potential of old industrial buildings early by redevelopment and wholesale conversion, so as to provide suitable land and premises to meet the needs of the Hong Kong community and the development of a knowledge-based economy, including the six economic areas (such as cultural and creative industries) in which Hong Kong has comparative advantages as identified by the Chief Executive's Task Force on Economic Challenges.

Over the past 20 years, the Town Planning Board (TPB) has introduced a range of planning measures to facilitate better uses of old industrial land and industrial buildings, such as broadening the permissible uses in industrial buildings and rezoning surplus and suitable industrial land for non-industrial uses. Building on the above, the new measures to revitalise industrial buildings are formulated to offer further support in respect of land administration to encourage redevelopment and wholesale conversion of industrial buildings by owners.

We only require that the new uses of the redevelopment or wholly converted industrial buildings should comply with the permitted uses in the relevant zones. We will not impose any new restrictions on the use of the converted industrial buildings. We believe that owners will determine the best uses for the redevelopment or converted buildings having regard to factors such as market demand, locations of the industrial buildings and situations of the existing tenants. For the same consideration, the Government has no intention to introduce additional policy initiatives to attract owners to allocate the converted units for any particular use.

(d) Home Affairs Bureau (HAB) proposes to inject $3 billion into the Arts and Sport Development Fund (ASDF) as seed money and to use the annual investment return of the Fund to provide sustainable additional resources for subsidising the long-term development of the arts, culture and sport. The injection will be divided equally between the arts portion and sports portion of the Fund.

HAB plans to set up a new funding mechanism to support arts and cultural projects of substantive scale initiated by artists or arts groups, as well as other longer-term yet time-limited arts and cultural programmes. In parallel, HAB also plans to provide additional funding to support schemes or projects initiated or recommended by the HKADC, particularly to promote the development of small and medium-sized arts groups, nurture budding artists, and enhance community appreciation of and participation in culture and the arts. Around $30 million would be reserved annually for the HKADC for such purposes.

Through its various funding schemes, the HKADC has in fact been supporting and meeting the needs of arts groups and artists of different nature and development stages. Among others, its "One-year/Two-year Grant" schemes aim to provide strategic support to local small and medium-sized professional arts groups to facilitate their longer-term planning and development. We understand that some groups currently supported by "One-year/Two-year Grant" schemes are users of industrial premises. The provision of additional funding to the HKADC from the ASDF will be conductive to enhancing the HKADC's resources for supporting local arts groups and artists.

(e) Conversion of industrial buildings for other uses must be in compliance with uses permitted under the statutory plans for the relevant zones. According to the sets of "Definitions of Terms" used in statutory plans, venues for arts performances such as music or drama, etc. are defined as uses of "Place of Recreation, Sports or Culture", which are always permitted in the non-industrial portion on the lower floors of buildings provided with a buffer floor in "Industrial" and "OU(B)" zones. If a "Place of Recreation, Sports or Culture" is to be provided on floors other than the said non-industrial portion, or in industrial buildings without a buffer floor, an application for planning permission from the TPB is required. "Place of Recreation, Sports or Culture" is an always permitted use in "Commercial" zone and in industrial buildings which have undergone wholesale conversion for non-industrial uses in "OU(B)" zone. Apart from planning requirements, owners of industrial buildings are required to comply with the relevant legislation and licensing requirements.

According to the Buildings Ordinance, "places of public entertainment" are those specified in Section 2 and Schedule 1 of the Places of Public Entertainment Ordinance (Cap.172), which include music or drama performance venues. To dovetail with the new measures to revitalise industrial buildings and to facilitate the industry to set up places of public entertainment in converted industrial buildings, the Buildings Department has re-examined the relevant requirements under the Building (Planning) Regulations for setting up places of public entertainment in non-domestic buildings without polluting industrial undertakings. The relevant practice note has also been revised accordingly. Provided that safety requirements are met, each wholly converted industrial building can accommodate places of public entertainment with a total capacity of not more than 500 persons.

Ends/Wednesday, May 19, 2010
Issued at HKT 15:17