Ambitious plan to redevelop 3,300 buildings in heart of Hong Kong runs into financial problems
- Project that would add tens of thousands of public housing flats would entail HK$100 billion hit to authority
- Developers only interested in profitable projects, but the development density in the areas has already reached limits allowed, managing director says
A plan to redevelop more than 3,000 buildings in two densely packed districts of Hong Kong will be too costly to implement fully, the Urban Renewal Authority has revealed.
The concerns came as the semi-public body recorded a massive drop in its surplus for the past financial year and estimated it would run a HK$100 million (US$12.9 million) deficit in the current one, raising fears over its long-term sustainability.
“We have a budget deficit for the coming financial year, but there’s no need to be overly concerned,” URA chairman Chow Chung-kong told the media on Wednesday.
“We are hopeful that there will be cash inflow arising from some new sites [put] out for tender next year. But in the near future, as we will be planning for larger and more extensive redevelopment projects, there might be shortages of cash flow and the authority might need to look for ways to finance ourselves by that time.”
The authority has been working on redeveloping parts of Yau Ma Tei and Mong Kok, involving 3,300 buildings, 80 per cent of which are three decades or older, to make better use of the land and generate housing.
