Something has to give amid gentrification of Hong Kong
Bernard Chan says Hong Kong must balance the needs of rich and poor
The media have recently been covering big changes in a city I know well: San Francisco. The Silicon Valley tech boom has attracted large numbers of highly paid newcomers. Rents have spiralled out of reach for existing residents, some of whom have responded by mounting protests. Traditional businesses and cultural activities are being driven out by high-end brands.
People are moving into less desirable neighbourhoods, and this is driving poorer families even further out.
Gentrification seems to be taking off in the world's most prosperous urban centres. In New York and London, for example, people are seeking to move further out, to areas like Brooklyn and the docklands where rents are lower, again driving out local residents and businesses.
This all leaves a very serious question in Hong Kong: where will the less well-off go?
In Hong Kong, we associate this trend with the huge influx of mainland shoppers, which has caused a major expansion of designer and luxury stores. Rising rents have caused the closure of much-loved outlets catering to local residents. However, the impact may prove temporary.
In the longer term, our gentrification may well be more like that in San Francisco and other cities. We can expect continued inflows of bankers, for example, from the mainland, Asia and the rest of the world. Other professionals will probably come as new high-value activities develop, like creative industries, or indeed technology. More districts like Kennedy Town will become trendy and less affordable, and more dilapidated blocks in areas like Sham Shui Po will be targeted for redevelopment.
This is not new. The reason cities have skyscrapers in the centre is because land prices go up there as the economy grows. There is bound to be spillover into once-poorer areas nearby over the years.
But global trends are adding to the effect. Globalisation has facilitated greater mobility of people and their fortunes. Chinese, Russian, Middle Eastern and other Asian wealth has grown, and the new rich want to diversify their holdings. Some of it might go into art and yachts, but a lot goes into real estate. Hong Kong, like Vancouver and California, has seen a lot of mainland Chinese wealth going into property.