Centaline owner Sze Wing-ching said it was likely his paper, which he hoped to start in a few months, would have an initial print run of 100,000 copies a day.

A KCRC spokesman said: 'The idea is to make use of our stations as a distribution channel for newspapers.

'That means we will receive rental from the organisation but we will not be involved in the operation of the newspaper.'

The newspaper would compete with Metro Daily, which is available free in MTR stations and has a daily circulation of 302,000. MTR stations handle 2.4 million passengers a day.

The new paper is on a recruitment drive for editorial, advertising and marketing staff, and Metro has reportedly lost several editors and other staff. One former Metro staff member said: 'Many chief editors and deputy chief editors have resigned to move to the new paper.'

Mr Sze said he already had most of the top-tier staff in place.

Describing his target audience, Mr Sze said: 'We will target those young people who have started in secure jobs; they're getting higher positions, higher pay. The newspaper should look more on the bright side of Hong Kong rather than telling people they have no future.'

Media analysts said links to Centaline's property arm might give the newspaper a chance of success, but Mr Sze insisted that his real estate agencies would pay for advertising in the newspaper like everyone else.

'I think I would like them to run independently. I will not force Centaline to advertise in my newspaper. If [the advertising staff] cannot perform their function, I will not force Centaline to give advertising to them.'

Damon Wong, senior research analyst at Quam Research, said the new paper faced an uphill battle in the crowded media market.

'It will definitely be loss-making until they can prove to advertisers they have readership. It will bleed red for the first year or so. It doesn't matter whether they print 100,000 or just 50; without advertising, they'll be loss-making.'

Joseph Man Chan, of Chinese University's school of journalism and communication, said there may be room for another paper, especially at the upper end of the market.

But he queried whether a free paper would work as a strong marketing ploy, especially if the paper targeted an affluent audience.

'My hunch is that the price is not a problem for these affluent people.' he said.

'They can afford to buy a paper. The important thing is whether it serves as a good alternative to what they have been reading. These people are not short of money; what they are short of is time.'