2014 was a good year for the Engineering and Construction industry. In 2003, Hong Kong’s construction sector experienced some down time. But over the past year, it has been booming. Data from the Hong Kong Census and Statistics Department indicates that the city's construction sector achieved positive growth in 2014. Real growth for construction industry value grew by 3.1% in real terms in Q1 2014. Meanwhile, expenditure on building and construction in gross domestic fixed capital formation, an indicator that is strongly correlated with construction industry value growth, grew by 0.5% in real terms in Q2 2014 and 1.1% in Q3 2014.
Now, we a moving into a new year. Given the performance of Hong Kong's construction sector thus far, it can be expected that the construction market in Hong Kong will continue to grow in 2015. Some new projects are also scheduled for this year.
New Residential Sites
Insufficient housing space has been one of the big problems in Hong Kong for a few years. In order to ease the tension, the government had released a new housing plan for the coming years, including releasing more residential sites. In the first quarter of next year, four new residential sites, which are Pak Shek Kok, Sai Kung, Ma On Shan and Sheung Shui, involving roughly 1,500 flats will be tendered. The number of flats built on these sites are limitless. Starting January 9th, Tai Po residential site will be opened for tender, which has a site area of about 23,239 square meters and the maximum gross floor area of about 83,660 square meters. On top of these 4 sites, the Urban Renewal Authority’s Fuk Wing Street project and MTR Corporation’s LOHAS Park project are also ready to start in 2015. With all these new projects, the aggregate private housing land supply for 2014-2015 is expected to bring about 20,700 residential units, which is a record high since the private housing land supply target is introduced by the Government in 2010. The Government has also secured the necessary land sites for building up to 254,000 public housing units for the next 10 years.
Tourism is a major part of the economy in Hong Kong. With more and more tourists coming to visit, more new hotels are required. Until the end of September 2014, Hong Kong has 240 existing hotels with a total of 72,359 rooms and 905 guesthouses with 8,479 rooms. To meet the rapidly increasing numbers of overnight visitors to Hong Kong, different new hotel projects are starting. There are expected to be 263 hotels with about 74,678 rooms by the end of 2015. For example, Hong Kong Disneyland announced it is to build a third hotel in February 2014. The hotel, expected to open in 2017, will have 750 rooms and feature a tropical rain forest theme. Also in February 2014, currently under construction, West Kowloon Cultural District Authority confirmed it was planning a hotel for visiting artists to the new cultural district. Further hotel development was announced when government indicated its intention to release land for six hotel sites facing the harbour at Kai Tak near the new cruise terminal, in phases from the end of 2015. In October 2014, the tender for a Tung Chung hotel site has also been awarded on a 50-year land grant at a total premium of $1.83 billion.
New Civil and Infrastructural Projects
Apart from the building works, different new civil and infrastructural projects are also scheduled for the coming year. First of all, in order to support the growing traffic volume, the government had announced that a coastal road from Tung Chun to Tai O, along with another road from Tai O to Fan Lau, are about to be built. This 11km Tung Chung-Tai O road will include a 750-metre tunnel. And based on early estimates, it will cost around HK$4.7 billion and take around eight and a half years to be completed.
Secondly, since April 2013, the Government has commenced the site formation works and construction of connecting road for the new Liantang/Heung Yuen Wai Boundary Control Point (BCP) in phases. Thisproject will provide an efficient access across the boundary to the eastern part of Guangdong. The construction works are expected to be ended in 2018.
Thirdly, the Sandy Ridge Cemetery project, a potential site for developing columbarium, crematorium and related facilities, is another new infrastructural project. In 2012 the feasibility study on the site formation and associated infrastructure works of this project was completed, and the detailed design was commenced in 2013. Construction works under the project are scheduled to commence in 2016 for completion in stages in 2019 and 2020.
In conclusion, with the expected projects, the Engineering and Construction market in Hong Kong is expected to continue growing in 2015. For sure that more and more engineering professional will be needed. With different new opportunities, 2015 will be a good year for all the professionals.
Hong Kong & Asia Region