Housing and infrastructure lead Hong Kong policy address

This year's policy address sets out over 200 initiatives on which the government of Hong Kong intends to focus its activity. They include three new railway lines, as set out in the 2014 Railway Development Strategy; and the reclamation of significant quantities of land in order to deliver on new housing projects and address shortages of supply.

Chief executive Carrie Lam described housing supply as "the toughest livelihood issue facing Hong Kong society".

"Housing is not simply a commodity and our community has a rightful expectation of the government to provide adequate housing," she said. "I hereby set a clear objective that every Hong Kong citizen and his family will no longer have to be troubled by or pre-occupied with the housing problem, and that they will be able to have their own home in Hong Kong, a city in which we all have a share."

Infrastructure expert Alvin Ho of Pinsent Masons, the law firm behind Out-Law, said that the initiatives announced by Lam would be welcomed by contractors.

"With a number of major projects on the horizon, the government is keen to stimulate another construction boom in Hong Kong to navigate the city's economy away from a period of turbulence," he said.

The government has reaffirmed its commitment to reclaiming over 1,000 hectares of land near Lantau Island; the 'Lantau Tomorrow Vision' project set out in its 2018 policy address. In addition, it intends to explore the development potential of 220 hectares of reclaimed land at Lung Kwu Tan and about 220 hectares of coastal area at Tuen Mun West.

Around 700 hectares of land will be 'resumed' from private landowners, of which around 400 hectares will be resumed in the next five years, according to the policy address. This land will be used for upcoming large-scale public housing and other public works projects, Lam said.

Ho said that the estimates set out in the policy address were "significantly more than the 20 hectares resumed in the past five years", and would offer substantial opportunities to contractors.

"These housing projects will entail significant planning, design and construction of civil engineering works associated with site formation and infrastructure works; and are expected to create tendering opportunities for contractors of all trades," he said.

"The land reclamation projects mean tendering opportunities for contractors, but also challenges posed by the shortage of sand supply from China," he said.

The government intends to speed up delivery of three new railway lines set out in Hong Kong's Railway Development Strategy 2014: the Tung Chung Line Extension, Tuen Mun South Extension and Northern Link. These three planned lines have a combined route length of around 15 kilometres, and will cost an estimated HK$35 billion (US$4.46bn) in 2013 prices.

Detailed planning and design for the three new lines will begin in 2020, so that actual construction can begin as early as possible.

"This is welcome news to the infrastructure sector which has been experiencing a shortage of projects following the recent completion of the Express Rail Link, Shatin to Central Link and many significant public projects," said Ho.