Letter to Innovation Technology Commission: Concerns of Change of Land Use near HKSTP

IT Voice met representatives of ITC in July, 2014 to express our concern on the lack of land for technology development and the change of use of Pak Shek Kok. We supplement our presentation with a follow-up letter in August 2014.

 

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Concerns on the Change of Use of Land near the Hong Kong Science and Technology Park

Mr. WONG Chung Yan, Johann, JP, Deputy Commissioner for Innovation & Technology

Dear Sir,

IT Voice is a group of liberal IT professionals committed to contributing to the prosperity of Hong Kong and the industry.

This letter is to follow up our meeting with you on the recent attempt to change the use of the piece of land at Pak Shek Kok near the Hong Kong Science and Technology Park.

Thank you for meeting us on 10th July. It was a fruitful session to exchange views amongst ITC, HKSTP and IT Voice. We had submitted a paper to the Town Planning Board for consideration of their consultation. For some of the points we had not included in the paper, we would like to state in this letter for you to evaluate.

We are very worried on the supply of office and research workshop space for technology development of 5 to 15 years from now. We recognize some growing demands that might have been under estimated in the ITC or Planning Department’s planning.

 

1.     Company Expansion of Current Tenants of HKSTP

Current tenants are expanding their business in view of a growing economy. The best choice for them to continue their successful business is renting a larger space in HKSTP. Some of the ex-tenants are forced to relocate to other districts because of the limited office space within HKSTP. When they move out, the benefits of clustering effect is diminished for them and HKSTP. This violates the objective of HKSTP.

2.     Office Consolidation of Current Tenants of HKSTP

In the lifecycle of the incubation program, a tenant which grows in size is usually allocated scattered small offices instead of one expanded office. For better productivity, these small offices should be consolidated. There is a need of buffer space in HKSTP to facilitate this consolidation.

3.     Return Hong Kong Investors from Overseas

In the past 10-20 years, some Hong Kong investors had moved to China or neighbouring economies. This migration was once a loss to Hong Kong’s development. Luckily some of them have survived and matured. Due to change of global environment, for example, rise of labour cost and rental in Singapore and  unfavourable development environment in China, some of these HK overseas investors are considering relocating back to Hong Kong. This is great news to Hong Kong’s innovation technology development and the job market if Hong Kong can capture this gold opportunity. One of the biggest challenges for them is to find a suitable place in a science part setting. This kind of demand may not be reflected in the current number of HKSTP rental applications.

4.     High-value-added Factories/Workshops

Some companies are looking for small manufacturing space to set up high-value-added factories for their research development. They have specific needs to the settings, for example, control of environment, control of access, and proximity to the research center, so that researchers can visit the factory frequently to review the production process and make adjustments. This is a very critical factor for a company to consider a headquarter base. We strongly advise HKSTP to allocate this kind of space in the park.

5.     Other Districts in Hong Kong for Technology Companies

We learned from both the Planning Department and ITC that there will be huge space allocated for technology in North East NT and Lok Ma Chau Loop Development Plan. However, both places are in planning stage and will not be ready for use before 2030. We have also evaluated rental space of other developed districts in HK, including Kwun Tong and Fo Tan. This rental space is competing by all different industries including hospitality, finance and banking (Kwun Tong). The government has also promoted these two districts as the new base for the arts and creative industry. In reality, the rent rate can raise significantly during contract renewal. Some landlord may even terminate the rental at the end of the current contract. The instability of rental arrangement poses a risk for company to invest in costly high-value-added equipment to setup laboratory or small factory which in turn hampers their competitiveness.

6.     Change of Government Policy Shaking Investor Confidence

Government policy is the biggest consideration for technology companies to invest in an economy to setup their research center and factory. Stable and consistent government policy is more favourable to investors. In the past few years, government has been successfully positioning HK as one of the best places for technology development. Changing the use of the piece of land near the Hong Kong Science and Technology Park to residential purpose gives a strong negative signal to foreign technology companies on the commitment of HKSAR Government in innovation technology development and lowers their desire to invest their valuable resources in Hong Kong.

We have balanced every aspect of policy considerations before commenting that the best use of land at proximity to HKSTP should be retained for technology development. We hope that ITC takes the above demands into consideration in the planning of the current Pak Shek Kok and future development of science parks.

In the meeting, we also exchanged our views on other aspects to promote technology development in Hong Kong including lowering hurdles in funding and supporting virtual clustering activities outside the science parks. IT Voice hopes that we can continue to communicate and collaborate with ITC for the betterment of the development of Hong Kong.

We are eager to discuss this with you face to face. You may contact us via Mr. S.C. Leung,or Mr. Eric Yung

 

Regards,

The IT Voice Team

Robin Bradbeer 
Ben Cheng
Francis Fong
Erwin Huang
William Kwan
Ken Lam
Roger Leung
SC Leung
Rick Mak
Joseph Ng
Chester Soong
Stephen Tang
KF Tsang
CY Tsui
Joe Yau
LF Yeung
Wilson Yeung
Lento Yip
Sang Young
Eric Yung

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