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3. Practical Issues and Challenges in

Land Supply

There is an emerging discourse in the community that land supply
does not necessarily have to rely on reclamations or development of new
towns. The said discourse argues that there is still a large amount of land
resources that has not been efficiently used in Hong Kong. Therefore, the
formulation of land supply strategy by the government should prioritise
optimising inefficiency in the existing land resources.

An example of the inefficient use of land resources is brownfield
sites. “Brownfield sites” refer to abandoned agricultural or rural land in the
New Territories that are converted into various other uses such as open
storage, container yards, warehouses, and industrial recycling yards etc.,
which are often incompatible with the surrounding environment.

OHKF believes that brownfield sites are only one of the many land
supply avenues and are not enough to satsify all land demand. The vast
majority of our brownfield sites are privately owned, and are with different
operations. To develop brownfield sites, the process must involve such
issues as land resumption, relocation, resettlement, and compensation.
We have surveyed numerous public housing projects to be completed in
the years 2015/16 to 2018/19 and established that whenever such issues are
involved in these development projects, they all require an exceedingly long
lead-time. Indeed, the several New Development Area (NDA) projects being
pursued by the government cover a sizable area of brownfield sites.

In the United Kingdom (UK) where the “Brownfield First” principle is
adopted, not only does the definition of brownfield differs from Hong Kong,
most of their brownfield sites are vacant. It is estimated that while the UK
would need up to 3.3 million new homes from 2015 to 2030 (15 years), total
housing capacity of brownfield sites is only 1 million. In other words, if only
brownfield sites are used for housing purpose, the country would see, on
top of the shortage that it is already faced with, an additional shortfall of 2.3
million homes in the next 15 years. Another study has also estimated that
the new homes to be built on brownfield sites in London (instead of the
UK) would cost an average HK$10,000 psf (adjusted as 2015 HK$), which is
more or less the market price of private residential property in Hong Kong.

Taking into account that Hong Kong has not seen any large-
scale land development projects for an extended period of time, land
supply policy must follow a multi-pronged approach instead of prioritising
brownfield sites, or any particular avenue of land supply over others.

4. Land Reserve

While the decision to halt the supply of land and housing during
the recession and property market slump of the late 1990s and early 2000s
was justifiable given the circumstances; with hindsight, it makes one
wonder that if the government were to start on the statutory planning
requirements and works-related feasibility studies a decade ago, would
the housing problem today be less severe. Indeed, a number of large-scale
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