Hong Kong may need to dig deep for supply of commercial space
Four strategic districts have been selected for a pilot study on underground shopping centres
Restaurants, shops, theme parks and fast-food chains enjoyed brisk sales as hordes of tourists descended on Hong Kong during the Lunar New Year holiday, but how long can they cope with the escalating influx?
The Immigration Department recorded 850,000 visitor arrivals during the first three days of the Year of the Horse, starting on January 31, up 120 per cent from the first three days of the Lunar New Year last year and 197 per cent from 2012.
However, the city's tourism facilities are nearly saturated, and the government is looking for ways to increase the supply of commercial space.
One of them was mentioned by Chief Executive Leung Chun-ying last month in his second policy speech.
He said: "The government has commenced a study to identify districts with potential for developing urban underground space, with a view to increasing usable space and enhancing connectivity in the urban areas. We are preparing a pilot study covering four selected strategic districts, namely Tsim Sha Tsui West, Causeway Bay, Happy Valley and Admiralty/Wan Chai."
Last Wednesday, a paper prepared by the Planning Department and submitted to Yau Tsim Mong district councillors named Hong Kong Park, Victoria Park, the Happy Valley Racecourse, Kowloon Park, Southorn Playground and Hong Kong Stadium as potential areas for urban underground development.
Owing to their easy accessibility, the underground shopping complexes will likely attract shoppers from Hong Kong and abroad.
To a certain extent, this will help ease the shortage of commercial space - not just for shopping but also dining and entertainment - as the government predicts the city can expect 70 million tourists by 2017, up from 54.3 million last year, and 100 million within a decade.
Property experts said there was a long queue of overseas retailers hoping to open their first flagship stores in Hong Kong to showcase their products to wealthy mainlanders.
But many have been forced to skip over the city because of the lack of supply of large retail shops for lease. Instead of halting their expansion plans, some have decided to set up their Chinese flagship stores on the mainland instead.
An increase in the supply of retail space might attract not only some of these overseas retailers to the city, but also small retailers edged out by big players that can afford soaring rents could also relocate to underground shopping complexes, where rents are likely to be lower than at street level.
Underground shopping malls in Japan and on the mainland could serve as examples of how shoppers can be diverted from the streets.