Waterfront gem could fetch $75billion, but fail to impress

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The government sale of a prime Central waterfront property could fetch billions – and be an uninspired mess when it is built. (Photo credit: Benoy Limited)

A report from earlier this week suggested that the Hong Kong government is planning to sell the site 3 at Central Waterfront. The site, which is a 1.5 million square feet development that extends from Jardine House and City Hall to the Maritime Museum, is widely known as a “trophy site”, highly prized by developers not only for its commercial potential but also the prestige associated with the site. According to the report, the sale could fetch up to a whopping HK$75 billon.

While the potential selling price has certainly driven headlines, it’s the tendering process that concerned environmentalist and district councilor Paul Zimmerman, CEO, Designing Hong Kong.

Bureaucratic brief

“Whoever buys Site 3 will have to submit a Master Layout Plan for approval by the Town Planning Board to ensure that it meets the official ‘Planning Brief’. The problem is that the brief was produced through a bureaucratic process and is bereft of real urban design requirements,” says Zimmerman. He adds that a competitive design process is needed before the site is handed over to a developer. “Rather than just selling the site to the highest bidder, an open competition for the best architectural design that meets public needs should be included. Developers should be required to first qualify, with design proposals, before bidding to build the winning scheme.”

Indeed, the property carries symbolic significance and will be the link that connects the heart of the city to the ferry piers. It will also be an ideal location for firework shows at the Victoria Harbour and is expected to be featured on the cover of many tourism and travel advertisements for Hong Kong.

“Imagine several developers competing for the site in a design competition before it is sold. It will bring out the best of this special project for Hong Kong, and everyone will win,” said Zimmerman. “This competition of ideas will bring out the real opportunities and public gains that Site 3 offers.”

An example is the idea proposed by UK-based architecture studio Benoy, which proposes including 44,800 square metres of office space and 105,200 square metres of retail plus another 3,600 square metres of public transport facilities as well as public car parking area.

The design has sparked discussion and provided a glimpse of the potential of the site, which is currently just pretty much an empty area and is being rented out for temporary recreational use from time and time, currently including the Great AIA European Carnival.

“It would be nice if we can have an area where we can sit and enjoy the harbour,” said Rainbow Lee, a Hong Konger whose office is located at IFC which is within five-minute walking distance from the Harbour. “I travel a lot and I can tell you Hong Kong has one of the most beautiful harbour views but there is just no where you can sit and enjoy it!”

John Fitzgerald, chief executive of Urban Land Institute Asia Pacific, agreed with Lee’s point of view.

“The redevelopment of Site 3 will shape its future use and will change Hong Kong’s iconic skyline,” said Fitzgerald. “We hope to engage industry leaders and the public in discussion about the city’s future and to share international best practice.”

Price too rich for the locals

Despite the general consensus that Zimmerman’s advice is sensible, analysts suspect the final sale will most likely end up with some wealthy mainland group, as the quoted HK$7.5 billion price tag would put off even the largest local developers. The chances of a simple tender without excessive sales conditions are high, analysts said.

Bloomberg data has shown that large land sales in Hong Kong have been increasingly dominated by mainland players. They comprised 96% of all transactions, by value, in 2017, compared to 39% in 2016, and less than 6% in 2009.

(Printer – R&R Publishing Limited, Suite 705, 7/F, Cheong K. Building, 84-86 Des Voeux Road Central, HK)