A review of the effectiveness of urban renewal in Hong Kong

Purpose - The purpose of this paper is to examine the progress of rehabilitation and redevelopment and review the effectiveness of the Land (Compulsory Sale for Redevelopment) Ordinance (LCSRO) (Cap. 545) and proposals that influence the urban renewal process in Hong Kong. Design/methodology/approach - The study largely relies on the review of the LCSRO and the Government's proposal, and the urban renewal progress. Rehabilitation and redevelopment data was collated and analyzed to assess how effective the renewal process and the Government legislation have been in tackling the urban decay problem in Hong Kong. This study benchmarks the good practices of Singapore. Findings - The pace of urban renewal activities in Hong Kong is lagging behind its policy goal. The implementation of the urban renewal programme has not adequately resolved the serious problem of ageing buildings. The existing legislation has not been effectively attracting private sector's participation either. The proposed relaxation of the compulsory sale threshold for specified classes of lots under the LCSRO aims to assist private sector-led redevelopment. However, it is not a panacea for urban decay. Whilst the private sector's participation is facilitated, the Government should consider complementary measures, e.g. the relaxation of such criteria as the building age, plot ratio and height limitation for a more effective and efficient process, particularly in less attractive sites. A careful balance should be maintained in redeveloping different regions in the city. The Government should also be cautious about the negative externalities that might affect to the community. Practical implications - The paper identifies the implementation gap of urban renewal in Hong Kong. Practical suggestions are made to the Government and related organizations to expedite urban renewal works. Originality/value - The paper assesses Hong Kong's urban decay problem in a quantitative way. This approach has hardly been applied in a local context. It also highlights important issues relating to private sector involvement in urban renewal activities and various concerns over the proposed changes to the LCSRO. The paper will benefit local policy makers, property developers and professionals in the area. Its results will form a basis for further research on the impact of the proposals on land supply and housing prices after its implementation.