LCQ10: Short-term tenancies of land
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Question:
The Lands Department (LandsD) currently grants short-term tenancies through tendering or direct land grant for non-governmental organisations or social enterprises to use unleased and unallocated government land. In this connection, will the Government inform this Council:
(1) of the following information on complaints against short-term tenancy site operators received by the Government in the past five years: (i) the number of complaints (and their annual rates of changes), (ii) the reasons for complaints and (iii) the number of cases with follow-up actions taken;
(2) of the following information on (i) the number of sites newly granted under short-term tenancies in various districts in each of the past five years and the respective (ii) areas and (iii) uses of such sites involved, with a breakdown by land disposal method (i.e. tendering and direct land grant);
(3) of the following information on (i) the number of sites with their short-term tenancies terminated in various districts in each of the past five years and the respective (ii) areas involved and (iii) reasons for terminating the tenancies of such sites, with a breakdown by land disposal method (i.e. tendering and direct land grant);
(4) of (i) the number of sites with tenancies renewed by the same tenant upon expiry of the fixed term of the tenancies and the respective (ii) areas and (iii) uses of such sites involved in respect of short-term land tenancies managed by the LandsD in the past 10 years (set out by district); (i) the average renewal term and (ii) the longest renewal term of such sites with tenancies renewed by the same tenant, with a breakdown by land disposal method (i.e. tendering and direct land grant); and
(5) as there are views that the prolonged renewal of tenancies of some short-term tenancy sites by the same tenant has runs contrary to the spirit of short-term tenancy, whether the Government has conducted a review on the effectiveness in respect of short-term tenancy sites; if so, of the details; if not, the reasons for that, and whether it has plans to conduct such a review?
Reply:
President,
Under the prevailing land approval policy, the Lands Department (LandsD) may grant short term tenancies (STTs) by way of tender or direct grant to support various social and economic activities and bring rental revenue for the Government. In addition, if an application receives policy support, and is considered in compliance with statutory or administrative requirements upon consultation with the relevant departments, the LandsD may grant STT to a non-governmental organisation and a social enterprise at concessionary or even nil rent for community, organisation, or non-profit making uses. The LandsD is responsible for granting and managing STTs, with fixed terms normally ranging from one to five years, and not exceeding seven years. Upon expiry of the fixed term, STTs will usually be re-tendered for another fixed term, or renewed according to the circumstances. The Government announced in the 2025 Policy Address that it would handle the tenancy term of Government tenancies in more flexible ways, and provide tenancy of a maximum total tenure of 21 years through renewal, which will mainly benefit lands for economic use, in response to the market suggestion of facilitating business and investments by providing a longer tenancy term. The relevant measures will be rolled out within the first quarter of this year.
My reply to the various parts of the question raised by the Hon Chan is as follows:
(1) As the nature and the type of land involved in each complaint are different, the LandsD does not maintain statistics on cases involving solely STTs. In general, upon receipt of complaints relating to STT sites, the LandsD would carry out investigations, including site inspection, as soon as possible. If any breaches of tenancy conditions are confirmed, such as violation of the user restriction clauses, the LandsD would take follow-up action immediately, including the issue of warning letters requesting the tenants to rectify the breaches, and may, subject to the circumstances, terminate the tenancy in accordance with the tenancy conditions and take back the site.
(2) In the past five years, the number of STTs freshly granted by the LandsD for commercial, economic, or social uses is set out in Annex I. The relevant uses include fee-paying public car parks, education, social welfare, religious, recreation, shops, factories, container handling, outdoor or indoor storage, and shipyards.
(3) In the past five years, the number of STTs for commercial, economic, or social uses that were terminated and the area involved are set out in Annex II. In general, the major reasons for termination of STTs include taking back sites for long term development (such as public housing development, Government land sale programmes) and termination initiated by tenants on their own considerations. Besides, only a minority of STTs were terminated for breach of tenancy conditions. For example, there were only about four such cases in 2025.
(4) and (5) If the sites are still yet to be required for long term development a few years after the expiry of the fixed term of the STTs, the LandsD will normally re-tender the STTs, so as to allow other interested business operators in the market to have a fair opportunity in bidding for the sites, maintaining healthy competition. That said, direct grant STTs which are related to economic activities, with policy support, or special historical background, may be renewed quarterly upon expiry of the fixed term. The LandsD does not maintain statistics on the average term and the average area of the STT sites with tenancies renewed by the same tenant. According to the statistics maintained by the LandsD, among the direct grant STTs, there are some 1 800 cases with cumulative tenancy period exceeding 10 years, the majority of which (around 1 550 cases) fall within a few major categories, including STTs granted for relocation of businesses affected by public works (such as shipyards); STTs converted from Government land licence in early years (usually shops or workshops); and some sites for public utilities or franchise operation (such as franchised bus depot). Among them, the longest STT tenancy term through renewal is 60 years, where the site has been leased for the use of a bus workers' canteen, to tie in with the operation of the adjacent bus terminal at Tsim Sha Tsui pier.
The Government would take into account a number of considerations in examining whether a site should be granted by way of STT or land lease, including where the site may be available for certain uses only on a short term basis; where the site may be available for supporting certain uses on a long term basis but STTs would allow greater flexibility in changing STT users; and where the site may be available for supporting certain uses on a long term basis but STTs may better meet the development needs of certain economic activities as one-off premium payment would not be required. As regards views that certain STTs may have run for too long, as explained above, there are policy or historical reasons for the relevant STTs. On the other hand, there are views in the market in recent years that tenancies with longer term may facilitate business and investments, which is also one of the considerations for our suggestion to provide Government tenancies for at most 21 years. While we understand the Hon Chan's concerns about fair competition, we should also take into account various considerations when considering the term of tenancies. When we grant new tenancies in future, we will take into account the relevant factors holistically and strike an appropriate balance.
Ends/Wednesday, January 21, 2026
Issued at HKT 16:01
Issued at HKT 16:01
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