The Task Force on Land Supply submitted eight recommended land supply options to the government on December 31. The option of “Developing Brownfield Sites” received 87 percent public support. The second most popular option was tapping into private agricultural land reserve in the New Territories, which received 68 percent public support.
The Task Force noted that private developers now hold over 1,000 hectares of agricultural land in New Territories, which represents roughly one third of the total land supply the eight options can hopefully create if they are implemented, thus making it potentially the the biggest source of land supply in the short and medium term.
Over the years, leading property developers have accumulated massive agricultural land reserve. These land plots have however been left idle due to the difficulty to get them rezoned for residential use.
Getting the approval from the Town Planning Board and the land premium negotiation are both big hurdles. Lack of infrastructure facilities was a key factor why authorities had been reluctant to allow the land plots to be reclassified for residential development.
Over the last five years, authorities have only approved seven agricultural land plots in New Territories, involving 18 hectares of land, to be converted for housing use. These land plots were developed into low-density residential projects and provided about only 2,800 flats.
The Task Force has now suggested that the government form a partnership with private developers to build both public and subsidized housing on farm land the developers already own.
The government will provide necessary infrastructure for these land plots, while private developers will be required to set aside part of the land site for public housing units.
Critics are concerned that the co-development model would raise suspicion of government-business collusion.
To address this issue, the report suggested an open, fair and transparent mechanism be set up.
Explicit targets like the minimum percentage of floor space to be allocated for public housing should be specified, for example.
Task force chairman Stanley Wong Yuen-fai stressed that the government should not give up any of the eight recommended options since it’s become urgent to secure more land supply.
Given the urgency to source more land, and the high support rate, the panel appears to be quite hopeful that the government will go ahead with the private farmland land option.
This article appeared in the Hong Kong Economic Journal on Jan 3
Translation by Julie Zhu
[Chinese version 中文版]
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