HONG KONG SAR - Media OutReach Newswire - 26 February 2025 - Response to the Budget2025/2026 by KK Chiu, International Director, Chief Executive, Greater China of Cushman & Wakefield:Large-scale land disposal for Northern Metropolis We are pleased to see the government continue to facilitate the development of the Northern Metropolis (NM) and optimize the industrial and spatial layout. We believe that the "large-scale land disposal" model can accelerate the completion of residential, industrial, and public facilities. The Development Bureau estimates that the engineering costs for each district will be from HK$10 billion to HK$20 billion. Compared to traditional models, the "large-scale land disposal" model can save more than HK$1 billion in public funds. Historically, construction costs in Hong Kong are two to three times higher than in neighbouring locations such as Shenzhen. We recommend that the government can reduce costs by introducing foreign labor, similar to the approach taken by the Singaporean government, and to plan effective transportation. connections to enhance investor confidence and attract more developers for sustainable growth. Compared to traditional land sale models, the large-scale land disposal model features a larger scale, longer development period, and extended payback time. This approach shifts high upfront costs and risks to developers, testing their financial sustainability and capacity to manage these burdens. However, during land levelling, developers can also plan and design, which compresses project timelines and increases their autonomy in design and construction. This flexibility enables them to respond effectively to market demands and create diverse residential or commercial projects. We recommend that the government effectively plan and utilize transportation facilities in new development areas and those connecting to external regions, such as the Shenzhen Bay Bridge and the planned Hong Kong-Shenzhen Western Railway. Enhancing transportation connectivity will improve convenience, boost investor confidence, attract more developers, and ensure the district's sustainability. The government's plan to prepare land for approximately 80,000 private housing units over the next five years We are pleased to see the proactive efforts by the government to stabilize future private housing supply. However, since more than 65% of the new land will come from new development areas, such as the Northern Metropolis and Tung Chung, it is crucial to prioritize infrastructure development. We recommend the government to ensure that infrastructure facilities are in place in these areas before the residential projects are completed, to avoid inconvenience for residents upon moving in.

The government stated that there will be eight residential sites for sale next year, which can help maintain a stable land supply. We suggest that the government make development conditions in the tender document as clear as possible and avoid putting excessive obligations on the developers as to provision of social or similar facilities, in order to invigorate market activity and to attract more small and medium-sized developers and new entrants to participate in the bidding. Response to the Budget 2025/2026 by Rosanna Tang, Executive Director, Head of Research, Hong Kong of Cushman & Wakefield: We are pleased to see the government's emphasis on attracting high-caliber talent and students, and that initiatives such as the Northern Metropolis University Town and the Belt and Road Scholarship will play a crucial role in attracting diverse global talent and students to Hong Kong in the long term. This influx will bolster demand in the local rental apartment sector and stimulate growth in the residential leasing market. However, there is currently a significant shortage of student accommodation in the market. Our latest estimates indicate that, on average, three university students are competing for a single bed...