The government yesterday offered examples of possible new uses for industrial buildings under a scheme announced in the policy address to encourage their conversion. But even as a spokesman held out a vision of loft apartments and serviced flats sprouting in old factories, it quickly became clear that the devil may lie in the detail. Under the three-year scheme, owners who convert entire factory buildings into other uses will be exempt from paying the waiver fee - a land premium reflecting the additional value of the converted building. The scheme, to start in April, is intended to make better use of vacant factories and remove polluting and high-risk industries outside industrial zones. A government spokesman said yesterday the programme would include factories in commercial zones converted into residential use. 'But it will involve major alternations to fulfil the planning and building regulations,' the spokesman said. It would be difficult for factories to comply with the lighting and ventilation requirements for residential use, and conversion projects must be completed three years after the application. Converting a factory into a living space might require demolishing some parts of the building to reduce gross floor areas to meet residential rules, the spokesman said. Far less development density and site coverage is permitted for residential use than for industrial use. But the chairman of the Professional Green Building Council, Wong Kam-sing, said such adaptations were possible. 'You could do it by creating an atrium inside the factory,' he said. Government statistics show 25 factories are located in commercial zones which may allow residential use, subject to alternative uses listed on individual outline zoning plans. Tanya Chan, deputy chairwoman of the Legislative Council's home affairs panel, was worried owners would prefer to convert factories into hotels and residences instead of creating space for arts and cultural industries. Secretary for Development Carrie Lam Cheng Yuet-ngor said it would be difficult to implement the scheme if it favoured only a few industries. The Lands Department would set up a team to handle the applications centrally, she said. The government will have its land revenue reduced under the scheme, as it receives about HK$120 million in waiver fees each year. An interim review of the scheme will be conducted.