THE movement of Hongkong manufacturers to southern China is continuing to reduce unit production costs through cheaper land and labour costs.
This is having a number of effects on the Hongkong industrial market.
The Hongkong economy is shifting from a production-based to a service-oriented economy.
Manufacturers are shifting their production to cheaper economies, such as southern China, while maintaining their administration and sales operations in Hongkong.
These Hongkong-based operations require a different type of facility, hence the redevelopment of older industrial buildings into quasi-industrial buildings, which are finished to a high standard with large office contents.
These can satisfy the requirements of a sales or administrative operation, while costing substantially less than traditional commercial locations.