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LCQ2: Industrial building revitalisation measures

Following is a question by the Hon Chan Yuen-han and a reply by the Secretary for Development, Mr Paul Chan, in the Legislative Council today (February 19):

Question:

In the past decade or so, quite a number of local cultural and arts workers have rented industrial building units for use as studios.  On the other hand, the Government announced in 2009 a set of revitalisation measures to facilitate the redevelopment and wholesale conversion of old industrial buildings (revitalisation measures), which have been implemented since April 2010.  The results of the "Survey on the Current Status of Industrial Buildings for Arts Activities and Future Demand" released by the Hong Kong Arts Development Council in 2010 indicated that the revitalisation measures had activated the transactions of industrial building units, posing problems such as increase of rentals and termination of tenancies to quite a number of cultural and arts workers who had set up studios in industrial buildings, and that situation was most acute in Kowloon East.  In this connection, will the Government inform this Council:

(1) whether it has conducted any survey on the number of tenants, vacancy rate and average rental of industrial building units in each year since the Government announced the implementation of the revitalisation measures in 2009; of the measures taken by the authorities to assist those cultural and arts workers affected by the revitalisation measures in coping with problems such as increase of rentals and termination of tenancies;

(2) whether it has conducted any survey on the number of studios set up by cultural and arts workers in industrial building units in Kowloon East, and the average percentage of the rental expenses against the total income of such studios, in each year since 2008; whether the authorities contacted the cultural and arts workers affected by the revitalisation measures and conducted related studies in the past three years, so as to understand their difficulties and needs; if they did, of the details; if not, the reasons for that; and

(3) whether it will conduct a comprehensive survey on the current uses of industrial building units in Kowloon East as well as those throughout Hong Kong, including the businesses of the tenants, the uses of the units, etc.; if it will, of the timetable; if not, the reasons for that; whether it will conduct a review of the impact of the revitalisation measures on the cultural and arts workers, with a view to formulating development plans and policies for industrial areas which can better meet the actual needs of the stakeholders?

Reply:

President,

The Government announced in October 2009 a series of revitalisation measures to facilitate redevelopment and wholesale conversion of old industrial buildings with a view to providing more floor space to meet Hong Kong's changing social and economic needs.  These measures have been implemented since April 1, 2010 and the deadline for submission of applications is March 31, 2016.  Subsequently, refined measures were implemented in April 2012 and February 2014.  As at end January 2014, the Lands Department had received 119 applications under the revitalisation measures, of which 90 applications had been approved, and the relevant projects could provide about 979 000 square metres of converted or new floor space.

The objective of the revitalisation measures is to better utilise the precious land resources of Hong Kong through encouraging the redevelopment and wholesale conversion of existing industrial buildings.  The measures have to take into account the needs of the economic development of Hong Kong as a whole, and also the aspiration of the owners and users of industrial buildings, which is market-driven.  The Government does not target at or tilt towards any particular sector.  Applications for revitalisation involve new uses in various areas, including the use for "Place of Recreation, Sports or Culture".  Upon completion of conversion of the industrial buildings for such uses, floor space can be provided for the use of cultural and creative industries.

As for the demand for space from the arts sector, the Administration will provide support and assistance as far as possible through measures such as those under the arts and cultural policy and district development initiatives, etc.  The Home Affairs Bureau (HAB) has been supporting and promoting arts and cultural development from the policy perspective, and the Hong Kong Arts Development Council (HKADC) has also been actively exploring more room for creative endeavours through partnership with different parties.

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

(1) and (2) According to the information provided by the Rating and Valuation Department, the overall vacancy rate of private flatted factories had dropped from 8.0 per cent in 2009 to 5.0 per cent in 2012.  At the end of 2013, the average rents for private flatted factories on Hong Kong Island, in Kowloon and in the New Territories were respectively $150, $163 and $101 per square metre.  The average rents for private flatted factories have been rising in recent years and the rate of increase between 2009 and 2013 is broadly comparable to the rising trend in average rents for private offices, private retail premises and private domestic units. 

As for the support for the arts, the HAB and the HKADC have been working closely with different sectors to promote arts development in Hong Kong.  With funding support from the HAB, the HKADC launched an "ADC Arts Space Scheme" by leasing about 10 000 square feet of floor area in a building in Wong Chuk Hang at below-market rate.  Under the scheme, arts studios will be made available for leasing to local visual and media artists at affordable rental fees.  Fitting out works for the units are expected to be completed in the middle of this year.  The HKADC is also working in collaboration with the Tai Po District Council to study the feasibility of converting a school premises in Tai Po which will soon be vacated into an arts centre.  In parallel, the Government also encourages the development of cultural facilities in support of artistic endeavours by community organisations.  For example, the Jockey Club Creative Arts Centre in Shek Kip Mei, which has 103 studios, operates on a non-profit making mode to provide space for artists with policy support and rental subsidy provided by the HAB.

As for Kowloon East, the Energizing Kowloon East Office (EKEO) of the Development Bureau has been kept contact with arts and cultural sectors from time to time (e.g. in organising workshops) to understand their views on the better utilisation of vacant government land for creative arts and cultural uses during the transformation process of Kowloon East.  The EKEO has also partnered with artists and designers in place-making activities such as the 12-week Playful Thursday at Tsun Yip Street.  In the "Fly the Flyover01" project, the open space underneath the Kwun Tong Bypass is converted into an informal cultural and performance venue that is open to the public for organising, among others, cultural and arts activities, music performances, and architecture and planning exhibitions.  To understand the operation plans and concepts of non-profit-making organisations on better utilisation of the space underneath the flyover for creativity, arts and cultural use, the EKEO launched a Market Sounding Exercise at the end of last year.  By making reference to the result of the Exercise, the EKEO will invite proposals from interested parties later this year with a view to identifying the most suitable operator as partner to operate the unused space underneath the flyover.

(3) The Planning Department is now conducting a new round of Area Assessments of Industrial Land in the Territory, which will include sample surveys of the private industrial building units in the industrial areas throughout Hong Kong.  In addition to uses of the units, the survey also covers the business nature and number of employees, etc. of the unit users.  The purpose of the assessments is to examine the usage patterns of the existing industrial sites and to explore whether the sites are suitable for converting into other more appropriate uses.  Apart from factors of individual districts and sites, the overall demand for industrial land will also be considered.  The entire assessments are expected to be completed within this year.

The EKEO will continue to explore opportunities to provide space for the creative industries and arts and cultural and arts community.  These include optimising the use of the remaining plots of flyover sites and exploring the possibility of incorporating space for cultural and art uses into existing and new premises.


Ends/Wednesday, February 19, 2014
Issued at HKT 14:55

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