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LCQ15: Supply of public housing
     Following is a question by Hon Chan Hak-kan and a written reply by the Secretary for Transport and Housing, Mr Frank Chan Fan, in the Legislative Council today (June 1):
     The Government has pointed out that it has identified about 350 hectares of land for provision of about 330 000 public housing units in the coming 10 financial years (i.e. 2022-23 to 2031-32) for meeting the estimated public housing demand of about 300 000 units. Regarding the relevant housing construction projects, will the Government inform this Council:
(1) of the following information on such projects: (i) the anticipated year of handing over of the sites to the Hong Kong Housing Authority and the Hong Kong Housing Society (the two bodies), (ii) the area of the sites, (iii) the estimated plot ratio of the sites, (iv) the estimated number of units to be supplied, and (v) the anticipated year of completion (set out by name of project);
(2) whether the two bodies will adopt the approach of Modular Integrated Construction (MiC) for constructing individual projects; if so, of the details; whether the Government has plans to set up production lines for producing MiC modules on its own or encourage the construction industry to do so, so as to ensure a stable supply of modules; if so, of the details;
(3) whether the two bodies or the relevant government departments have plans to submit to the Town Planning Board applications for planning permissions in respect of individual projects, with a view to enhancing the plot ratio or other development parameters of the relevant project sites, thereby increasing the number of units to be supplied; if so, of the names of the projects involved and the contents of the applications concerned; and
(4) whether the two bodies have sufficient manpower and financial ability to cope with the implementation of such projects; whether the Government will consider re-launching the Private Sector Participation Scheme, so as to help share out part of the housing construction work of the two bodies; if so, of the details; if not, the reasons for that?
     Having consulted the Development Bureau (DEVB), our consolidated reply to the question raised by the Hon Chan Hak-kan is as follows:
1. Actively identifying land for housing construction is the fundamental solution to the housing problem.With the greatest determination, the Government has been actively identifying land for housing development in a persistent manner. The Government has already identified about 350 hectares (ha) of land required for providing some 330 000 public housing units for the coming 10-year period (i.e. from 2022-23 to 2031-32), which can adequately meet the demand of about 301 000 public housing units in the above 10-year period. Of the 350 ha of land mentioned above, projects in the first and second five-year involve about 84 ha and 266 ha of land respectively. The plot ratio (PR) of relevant sites ranges from 3.5 to 7.5 in general. To optimise the development potential of public housing sites, the Government has relaxed the planning policy guidelines to allow increase in maximum domestic PR of certain sites where the planning terms permit.
     Based on the forecast as at March 2022, the public housing production forecast of the Hong Kong Housing Authority (HA) and the Hong Kong Housing Society (HKHS) from 2022-23 to 2026-27 is in Annex 1. Among the projects listed, about 80 per cent are under construction.
     As for public housing projects estimated to be completed in the second five-year period (i.e. from 2027-28 to 2031-32), they are mostly at the planning, engineering studies and architectural design stage. Their completion dates are subject to relevant studies and the progress of various stages in the development process such as land rezoning, infrastructure construction, land resumption, clearance or reprovisioning of affected facilities, site formation works. Their production programmes are therefore more fluid. The land source of relevant projects is in Annex 2.
     DEVB is striving to shorten the time required for the land production process, including exploring ways to shorten the time limits of certain statutory procedures, and conducting various procedures concurrently as circumstances permit. The above sites will be handed over to HA or HKHS for housing construction once the site formation is completed. To save time, HA will carry out pre-construction preparatory tasks, including planning brief formulation, detailed design, site investigations and tender invitations, in parallel with the Government's land production processes, such that the construction works can be commenced as soon as possible after the sites are handed over to HA.

2. HA will adopt Modular Integrated Construction (MiC) method in the following public housing projects:

(a) A 12-storey domestic block (about 200 units) at Tung Chung Area 99

     Construction works have commenced and are expected to be completed in 2024 tentatively. This project is located in a new development area with adjacent vacant site for temporary storage which can to a certain extent alleviate the risks in site logistics and temporary storage. HA can assess the effectiveness of applying MiC in public housing projects in terms of productivity, time and cost through this project;

(b) A 33-storey domestic block (about 400 units) at Tak Tin Street, Kwun Tong

     Construction works are expected to commence in 2023 and completed in 2027. This project is located in an area of busy traffic and involves high complexity of structural connections and subsequent waterproofing works for a high-rise block. The adoption of MiC will therefore be very challenging. The project is also situated at a congested site without much storage area which may impose a certain degree of difficulty for the planning of site logistics. Nevertheless, since most of the sites allocated to HA for public housing development have similar site constraints, applying MiC in this project can provide useful reference for HA to improve the standards in the selection of MiC projects in future; and
(c) Anderson Road Quarry Sites R2-6 & R2-7

     This project involves two sites. One of the sites comprises two 28-storey domestic blocks (about 1 000 units). Construction works has commenced and is expected to be completed in 2025 tentatively. The other site comprises a 17-storey domestic block (about 400 units). Construction works has commenced and is expected to be completed in 2024 tentatively. There are other projects of similar scale in the vicinity using non-MiC construction method and they will serve as good benchmark for cost and time comparison with these two sites.

     In addition to the above-mentioned projects, taking into consideration factors such as transportation network, site constraints and availability of temporary storage area in the vicinity, HA has also identified additional projects suitable for MiC application. These sites are mainly located in new development areas with less site constraints. According to preliminary estimation, these sites can provide about 20 000 units.
     Regarding HKHS, in support of the Government's policy on the adoption of MiC, HKHS has been applying MiC in two pilot projects. A 10- storey rental block for the elderly at Jat Min Chuen in Sha Tin will be built with steel MiC, providing 64 units with expected completion by 2023. A 27-storey subsidised sale flats building in Hung Shui Kiu Phase 1A will be built with MiC in concrete, providing 300 units with expected completion by 2024. HKHS is also actively considering to adopt MiC in some housing projects under planning, such as a project in Kwu Tung North.

     With rising popularity of MiC, market demand for production of MiC modules has been increasing. The Government notes that some industry stakeholders and investors are actively considering setting up local factories for the production of MiC modules. DEVB and its departments are open in supporting the industry, and will continue to communicate with the industry and foster sustainable development of the local construction industry.
3. The Government approved in December 2018 further increasing the domestic PR of public housing sites in selected Density Zones of the Main Urban Areas and New Towns by up to a maximum 30 per cent increase where technically feasible. Based on this policy, as at March 2022, eight planning applications for enhancing the development intensity of public housing projects have been approved. Relevant information is in Annex 3. In future, HA, HKHS and relevant Government departments will continue to submit planning applications for suitable projects with a view to optimising the development potential of the sites.

4. According to HA's budgets and forecasts announced in January this year, the total construction expenditure for public housing projects for the period from 2021-22 to 2025-26 is estimated to be about $128 billion. For the projected number of flats to be provided from 2026-27 to 2031-32, it is envisaged that HA's construction expenditure will be more than double. According to the existing mechanism, HA will conduct a rolling five-year budgeting exercise annually to assess its financial position and future funding requirements.

     HKHS is an independent, financially autonomous, self-financing and not-for-profit organisation, which funds its public housing projects with its own resources. HKHS will continue to take forward the relevant housing projects under the aforesaid mode of operation.

     HA has all along been adopting a design-tender-build procurement method for public housing developments whereby the Housing Department (HD) is responsible for the detailed design and construction drawings, while the contractors are responsible for the building construction. Given the substantially increased public housing production in future, HA will adopt a new Design and Build procurement model in suitable projects which can leverage on resources and expertise of the construction industry to further enhance the entire construction workflow. Contractors can make good use of their advantages in mobilisation and coordination efforts during the construction process, and will be allowed greater flexibility in the procurement of materials, construction methods and construction workflow. Under this model, HD can suitably allocate its limited resources to focus on the planning, coordination and supervision of public housing developments.

     In addition, the Government adopts a positive attitude towards tapping the resources of the private market to assist in providing subsidised housing. With reference to past experiences, the arrangements should be effective in providing sufficient incentives for private organisations to ensure quality of the flats constructed. Recently, a private developer has openly expressed its intention to provide subsidised housing on its private land. The Government welcomes such a proposal. If the proposal is materialised, it will help increase the supply of subsidised housing and can provide an additional option for potential homebuyers. The Government will maintain communications with the private developer concerned and provide assistance as appropriate.
Ends/Wednesday, June 1, 2022
Issued at HKT 17:01
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