New World Development wins right to design, build and run Hong Kong’s HK$30 billion Kai Tak Sports Park
- Local property developer secures 25-year contract ahead of mainland Chinese company Guangzhou R&F Properties
Hong Kong’s long-awaited and much-touted HK$30 billion (US$3.8 billion) sports complex planned for the site of the former Kai Tak airport will be designed, built and run by a subsidiary of local property developer New World Development, officials said on Friday.
The announcement follows years of wrangling over costs, designs and how much control the government should have over the project, which has already been more than a decade in the making.
The 28-hectare complex promises to be a boon for the city’s ability to attract world-class events, but the sports sector has concerns about being sidelined in favour of entertainment, retail and profits.
A 25-year contract had been awarded to Kai Tak Sports Park Limited, a subsidiary of New World and NWS Holdings, officials said.
“It is the government’s most important investment in sports infrastructure in recent decades,” a statement said. “We are looking forward to working closely with Kai Tak Sports Park Limited’s team to create a world-class sports park with high-quality facilities.”
It was understood New World clinched the contract over mainland Chinese developer Guangzhou R&F Properties.
“Our project team will work closely together with the government to create the sports park as a vibrant destination with state-of-the-art sports facilities,” a spokeswoman for the winning bidder said.
The facility will have a 50,000-seat multi-purpose stadium with a retractable roof, a 10,000-seat indoor arena and a 5,000-seat community sports ground, plus shopping and dining space.
It has been billed as a “park for all” and officials hope it will play host to everything from international sporting competitions to local athletes in search of a training ground, as well as large-scale concerts.
The project is expected to generate profits of up to HK$300 million (US$38.3 million) annually.
Construction work will begin in the first quarter of next year and is slated for completion in 2023.
The HK$30 billion price tag will be picked up by the government, while Kai Tak Sports Park Limited will cover operating costs.
The developer will also be required to pay the government 3 per cent of its gross annual income along with an extra HK$1.72 billion (US$220 million) over the 25 years of the contract.
Since the idea was first floated in 2005, the project has overcome a number of hurdles.
The last Hong Kong administration floated building it on the outlying Lamma Island to make way for housing at Kai Tak, a suggestion that prompted athletes to threaten to take to the streets in protest.
Others have branded the facility another “white elephant” and say it will be underused like the nearby Kai Tak Cruise Terminal.
Lawmakers have expressed scepticism about the “design, build and operate” model, suggesting the government should retain more control by forming a joint venture with the developer.
Last year officials drew ire for proposing to refund unsuccessful bidders with 50 per cent of the cost of their bid, capped at HK$60 million. The government said it would keep the intellectual property rights to their designs in return. It later limited the refunds to two losing bidders.
Sports representatives on Friday welcomed the result of the tender, but also warned that health and fitness could be reduced to mere window dressing when confronted with the interests of big business.
Timothy Fok Tsun-ting, president of the Olympic Committee of Hong Kong, said he hoped the operator of the long-overdue complex would strike a balance between sports, entertainment and commercial activity.
“We know it would be difficult to run only sports events in such a large-scale facility and that the operator needs to bring in commercial elements, but they must strike a balance so that sports will not be overlooked,” he said.
Pro-establishment lawmaker Edward Lau Kwok-fan said he hoped the government would monitor the operator and keep its promise to ensure the complex is accessible to the public at affordable prices.
“I don’t wish to see the site too commercialised and hosting more pop concerts than sports games,” he said.
The soccer community, which will be a key user of the main stadium, was also upbeat about the announcement.
“Other than being a landmark for Hong Kong, the park will provide top-class football for the fans,” said Pui Kwan-kay, vice-chairman of the Hong Kong Football Association.
“We can bring more quality teams from overseas with a bigger venue, and lower ticket costs with more tickets for sale,” Pui said.
“Remember when we had teams like Real Madrid, Manchester United and the Premier League Asia Trophy here in the past – it was always a full house at Hong Kong Stadium.”
But the Hong Kong Amateur Athletic Association has long objected to the proposed absence of a running track in the main stadium, which will mean they cannot stage world-class track and field events.
Officials have proposed they use the adjacent 5,000-seat public sports ground, but there will be no warm-up areas inside for international competitions.
Hong Kong has struggled to attract high-profile events compared to regional rivals.
A report compiled by financial services giant KPMG and the Business of Sport Network in September ranked the city behind Tokyo, Shanghai, Kuala Lumpur and Singapore for its events portfolio.