This article first appeared in City & Country, The Edge Malaysia Weekly on May 13, 2024 - May 19, 2024

From March 5 to 8, a total of 55 property industry professionals and experts — architects, surveyors, valuers, researchers, developers, town planners, lawyers, bankers and government authorities — jetted into Hong Kong International Airport for the first leg of Rehda Institute’s Asia Real Estate Leaders study tour to Hong Kong and Shenzhen.

Rehda Institute, an independent think tank focusing on research and education relating to housing matters, arranged the itinerary for delegates to visit several developments and sites as well as network with local authorities and organisations to exchange knowledge and understand their best practices. Joining the tour in Hong Kong was Minister of Housing and Local Government Nga Kor Ming, who showed great interest in the various social housing projects in Hong Kong.

The tour was led by Rehda Institute chairman Datuk Jeffrey Ng Tiong Lip, along with several members of the board of trustees. Ng provided key takeaways after the tour, noting that property development needed to go beyond dollars and cents to make an impact in society.

“‘Care’ and ‘connectivity’ are two new buzzwords, which can be incorporated into the popular notion of the ‘live, work and play’ property ecosystem. There is a continuous need to cater for the changing needs and wants of society and demographic changes in our communities,” Ng said.

“Size matters in property development in order to achieve quality development planning and economies of scale. Horizontal mixed-use developments in clusters work well in terms of providing conveniences, synergies and vibrancy to users and owners. Sustainable designs remain the key focus.

“Urban redevelopment in Hong Kong is well-established and a proven success story. The authorities have embraced holistic city planning, including en bloc developments and public rental housing estates, supported by practical property ecosystem approaches on rejuvenating decayed zones and modernising them into sustainable living environments. They prioritise and focus on achieving win-win outcomes for all relocated property owners and tenants.

“There are opportunities for the public sector to take on new solutions to provide more social/public housing and elderly housing projects. As a benefit to the rakyat in the B40 and M40 groups, this may come in various forms such as providing public rental housing estates, urban redevelopment schemes and subsidised sale flats.

“The key enabler is provision of free land or zero land premium payable in the context of Hong Kong by the government. Such significant reduction of development costs will offset subsidised housing assistance or compensation to relocated property owners. This is a powerful win-win formula for the public sector to embark upon and [it is] not done at no expense to the private sector in providing affordable housing.”

The first venue that delegates visited in Hong Kong was Tanner Hill, the first non-subsidised elder care housing project developed by the Hong Kong Housing Society, a non-profit organisation established in 1948. The development sits on two acres of land and comprises three towers with 588 units sized between 344 sq ft and 1,231 sq ft.

The units are for lease only and for tenants aged 60 and above. The older the tenant, the more the lease — or, in this case, entry contribution — is reduced. For example, the estimated entry contribution is HK$6.91 million (RM4.19 million) for a studio unit measuring 344 sq ft to 351 sq ft for a tenant aged 60. For those entering at age 85, the estimated entry contribution is HK$3.13 million for a similar unit.

Delegates had the opportunity to visit a show unit as well as facilities such as a traditional Chinese medicine centre, conventional medical centre, gym, heated swimming pool and restaurant. There are also activities organised to enable residents to interact with each other and engaged. While the development is focused on independent living, it provides assisted living if needed, but not palliative care.

Besides senior care, the delegates visited a social housing scheme, Hoi Tat Estate, developed by the Hong Kong Housing Authority (HKHA), which was established in April 1973 under the Housing Ordinance. HKHA is charged to develop, allocate and manage public housing estates for the low- and middle-income groups.

Hoi Tat Estate features four blocks, which have a total of 3,335 units with sizes ranging from 151.2 to 391 sq ft. The units are only for rent and priced from RM810 to RM2,092 per month, depending on the size. The population of Hoi Tat Estate is close to 9,500.

Amenities and facilities provided in the estate include medical facilities, retail shops with restaurants and conveniences, a kindergarten and care team office and resident association. There are also sports facilities and a library, and the area is close to the public transport network.

At this juncture, Nga took the opportunity to talk about how his ministry was studying and considering introducing a new social housing programme — Program Residensi Rakyat (PRR) — which will emulate Singapore’s Housing Development Board (HDB) in developing integrated housing projects that have green spaces and facilities such as a playground, community centre and sports elements. It is still being discussed.

He added that his ministry was looking to lower the consent threshold for redevelopment from 100% to about 75% and emphasised that all owners, particularly dissenting ones, would be looked after and supported.

Moving on from senior and social housing, the delegates were shown the opposite end of the spectrum when they met the management of Kerry Properties Ltd at its Hong Kong office. Kerry Properties, which is part of the Kuok Group, is a development company with investments and projects in mainland China and Hong Kong.

Kerry Properties showcased its luxury properties in a presentation: On Hong Kong island, it has high-rise developments, La Marina and La Montagne; and on the Kowloon side, the luxurious and exclusive Mont Verra and Mont Rouge.

The 600-unit La Marina comprises two towers, with layout ranging from one- to four-bedroom units with built-ups from 320 sq ft to 1,901 sq ft. During the presentation, it was disclosed that La Marina achieved HK$11 billion in sales in just three weeks and its rooftop special unit sold for HK$139 million, or HK$75,000 psf.

Meanwhile, the 800-unit La Montagne was launched in 2023 and comprises two towers, with layout ranging from one- to four-bedroom units sized from 389 sq ft to 1,517 sq ft. No sales figure was provided at the time of the presentation.

The exclusive Mont Verra features three 2-storey mansions and a 7-storey, 61-unit apartment block; and 45-unit Mont Rouge that comprises five villas, 14 landed homes and a 7-storey, 26-unit tower. At time of the presentation, it was disclosed that the combined sales figure of both projects was HK$3.5 billion.

The developer said it would focus on luxury products, as buyers looking for such properties are less price-sensitive, loyal to their brand and not greatly affected financially by the economic situation.

Besides residential properties, delegates also visited One Taikoo Place, an office building developed by Swire Properties. It is the first commercial building in Hong Kong to obtain three top Platinum sustainability certifications from WELL, BEAM Plus and LEED Final Platinum.

Completed in 2018, the 41-storey tower is located near Quarry Bay MTR station. It is the first of two triple Grade-A office towers in Swire Properties’ HK$15 billion Taikoo Place redevelopment project.

One Taikoo Place is also the first commercial building to have a waste-to-energy biodiesel tri-generation and absorption system that combines heating, cooling and power generation. It is also one of the city’s first commercial projects with an innovative dual-level roof fitted with a combined green roof and solar photo-voltaic system.

One Taikoo Place is home to property consultancy JLL Hong Kong’s office, where the delegates listened to presentations on the Hong Kong and China markets as well as the rules of property development in the city.

Real estate lawyer Alan Yip, a partner at law firm Howse Williams, talked about how the deed of mutual governance (DMC), carried out by the developer, allocates obligations to each unit owner and defines the common areas. This is a key document for ensuring that the development runs smoothly. The Building Management Ordinance ensures that the DMC is done correctly.

Later, the JLL Hong Kong team provided an overview of the local market. While the market is resilient, it has become more “affordable” today. In addition, the active sectors now are industrial and logistics, office and student accommodation.

One of the challenges in Hong Kong is developing new structures with limited land and space. To deal with this issue, Hong Kong’s Urban Renewal Authority (URA) was set up in May 2001 under the Urban Renewal Authority Ordinance. URA’s main responsibility is to undertake, encourage, promote and facilitate urban renewal of Hong Kong, particularly in the older parts of the city. 

During its presentation, URA explained that it used the 4R approach — Redevelopment, Rehabilitation, pReservation and Revitalisation — when it looks at improving selected areas in Hong Kong. Its activities include joint ventures with developers and landowners. Furthermore, government support through land resumption or land premium waivers help in reducing the financial burden in redeveloping or upgrading works.

Delegates then visited the Elements mall, which is a component of the world’s largest integrated development, the US$10 billion (RM47.4 billion) Union Square. The mall has a floor area of one million sq ft and is divided into five sections based on the Chinese elemental aspects of metal, wood, fire, water and earth. As the whole mall is one loop, the different sections are demarcated through the use of colour and textures. For example, the fire section has a fiery colour palette; and the earth section has more muted and textured detailing.

The mall was designed by Benoy, an architecture, interior design, branded environments, master planning and landscape architecture firm. The mall is located above the Kowloon MTR station, which links to Central MTR station and the airport. The mall sits below the International Commerce Centre building and is surrounded by several residential towers, which feed footfall to the mall.

The delegates then travelled to Shenzhen via high-speed rail to visit Qianhai, which was selected for its transformation. On Aug 26, 2010, the state council released a development plan for the Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone of Shenzhen, which states that “Qianhai would be built into a demonstration zone for modern service industry innovation and cooperation between Guangdong and Hong Kong”.

On Sept 6, 2021, the central committee of the Communist Party of China and the state council released a restoration plan called “Plan for Comprehensively Deepening the Reform and Opening up of the Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone”. This plan indicated the expansion of Qianhai’s initial land area of 14.92 sq km to 120.56 sq km.

According to the Qianhai website, Qianhai initially included only the Guiwan, Qianwan and Mawan areas — covering the original 14.92 sq km. It now also includes Shekou as well as the Dananshan and Xiaonanshan mountainous area of 22.89 sq km; the Bao’an International Airport and its surrounding areas of 30.07 sq km; the central Bao’an District and the Dachan Bay area of 23.32 sq km; as well as the convention and exhibition new city and the marine new city area of 29.36 sq km.

Within this massive development lies Qianhai Kerry Centre, the first commercial site for sale, following the establishment of the Qianhai Shekou Free Trade Zone. The delegates visited sites such as the JEN Shenzhen Qianhai by Shangri-La hotel as well as an observation deck for an aerial view of Qianhai Bay and its surroundings.

The Qianhai Kerry Centre consists of three sites with a total land area of about 68,800 sq m and total gross floor area of more than 400,000 sq m. The project consists of offices, a hotel, commercial and residential components, as well as green spaces and open areas.

The delegates also visited Huawei Ox Horn Campus and BYD Headquarters for a showcase of innovation and invention. The Huawei Ox Horn Campus is a 300-acre development that houses the research and development division of Huawei. It is divided into 12 zones named after cities or places in Europe such as Oxford, Luxembourg, Bologna and Paris. Each of these zones has European-designed buildings where about 25,000 employees are stationed. The vast campus is connected via a tram line.

Delegates got a hint of the vast investment put into the campus to churn out the new and latest products.

At the BYD Headquarters, delegates were fascinated by the new electric vehicles and a presentation on the company’s journey from inception until today. The headquarters also include the industrial portion, which houses the factories and workspaces as well as accommodation for workers. The area is so big that a train system is installed to ferry workers and visitors from one end to the other.

The study tour gave the delegates insights into the growth and dynamism of the property industry in China. The big takeaway was the willingness to invest huge amounts of money in R&D; and that sacrifice, powered by a strong vision and focused leadership, is essential. The road ahead is still long, and China is working hard to ensure it stays on track to achieving greater success.

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