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A high-profile contender in the bidding for government land to build a private hospital has hinted he will pull out, dealing a blow to government plans to encourage the provision of affordable private medical services.
Meanwhile, a leading private hospital, the Hong Kong Sanatorium & Hospital, also said it would not be taking part in the bidding.
Bernard Chan, a pro-government businessman who was an executive councillor from 2004 to 2009, said the terms of the tender were too demanding.
'We are still scrutinising the tender documents, though in this process we find it challenging to meet the requirements,' said Chan, president of insurer and medical services provider Asia Financial Holdings. 
'The chance is big that we are not going to [take part in the bidding],' he said.
Asia Financial, listed in Hong Kong, is a major shareholder in the 550-bed Bumrungrad International Hospital in Bangkok, the biggest private hospital in Thailand.
Chan has long expressed interest in trying his hand at the private hospital business in Hong Kong.
In 2009 when the government first invited 'expressions of interest' for the development of private hospitals at four sites, he revealed in media interviews a plan to build a 350-bed private hospital in Wong Chuk Hang at a cost of more than HK$2 billion. 
After years of delay, the government formally invited tenders last month for the development of private hospitals at sites in Wong Chuk Hang (27,500 square metres) and Tai Po (54,851 square metres). 
Terms of the tender require that no fewer than 300 beds be provided and at least half the beds be reserved for Hong Kong residents, while obstetric services are to be capped at 20 per cent of total capacity.
In addition, 30 per cent of services must be made available at a standard package price that covers all costs, from surgery and medicine to meals.
Such restrictions are unprecedented. The deadline for bids is July 27.
The Hong Kong Sanatorium & Hospital said it would not bid for the Wong Chuk Hang site, despite its proximity to the hospital's main buildings in Happy Valley. Director of nursing services Manbo Man Bo-lin said its feasibility study had shown that medical equipment might not survive the shock and vibration from trains on the future MTR South Island line.
Dr Alan Lau Kwok-lam, chairman of the Private Hospitals Association, has expressed worries that investors could be scared off because the terms of the tender were so demanding they could make it difficult for the hospitals to be financially viable.
A spokesman for the Food and Health Bureau declined to comment while tendering was in progress.
Union Hospital in Sha Tin, another known contender for the Wong Chuk Hang site, said yesterday it would probably go ahead with its bid. 'Most of the requirements seem OK to us, and we will go forward by engaging consultants and architects for the project,' a spokeswoman said. 
She said Union Hospital, which has operated since 1994, had long experience providing medical services in Hong Kong. Chan's abrupt U-turn triggered speculation he might be appointed to the Executive Council again by the incoming administration.
He is widely regarded as a supporter of chief executive-elect Leung Chun-ying and said earlier that the bidding might offer excuses for critics to stir up a controversy over a potential conflict of interest involving himself or Leung.
12 
This many of Hong Kong's 56 hospitals are private



Bidders running shy of hospital tender demands