PLC Panel on Trade and Industry

Science Park Planning Committee Report

This paper sets out the major recommendations of the Planning Committee on Science Park.

Background

2.The Industry Department commissioned the Segal Quince Wicksteed (Asia) Ltd. to carry out two consecutive studies to explore the desirability and feasibility of establishing a Science Park in Hong Kong in 1992 and 1995 respectively. Both studies confirmed the need and the demand for a Science Park in Hong Kong. While the stage-one study established the basic concept of a Science Park in Hong Kong, the stage-two study examined the objectives of and demand for the Science Park, as well as various implementation issues. The report of the stage-two study was issued for public consultation in late 1995. There was general support for the establishment of a Science Park at the Pak Shek Kok Reclamation Area in Tai Po.

3.A Planning Committee on Science Park (the Planning Committee) was set up in January 1997 to take forward the Science Park project. It was tasked to make recommendations to the Secretary for Trade and Industry on planning and implementation issues relating to the establishment of a Science Park at Pak Shek Kok, having regard to the findings and recommendations of the stage-two study report. The Planning Committee was chaired by the Director-General of Industry and comprised prominent industrialists, academics, leaders from relevant business sectors, as well as representatives of relevant government bureaux and departments. The Planning Committee finalised its recommendations and submitted them in the form of a report to the Government for consideration in November 1997. A copy of the report is at the Annex.

Major recommendations of the Planning Committee Report

Need for a Science Park and target opening date of phase one

4.The report considers that Hong Kong has to become a knowledge and technology-based economy, in order to maintain and enhance its global competitiveness in the next millennium. A Science Park will be an essential infrastructure for Hong Kong industries to move up the technological ladder and develop towards more technology intensive and higher value-added business activities. It will also help position Hong Kong as a regional centre for research and development (R&D) activities and innovation and technological development. The Planning Committee considered that timing is critical for the success of the Science Park given the very keen competition from other economies in the Region. The Planning Committee has recommended that the target opening date of Phase One of the Science Park should be the second half of 2001.

Site and size

5.The stage-two study recommended that the Science Park should be established at Pak Shek Kok Reclamation Area in Tai Po. The Planning Committee has further suggested that the Science Park should occupy an area of 22 hectares and develop in three phases over a period of 15 years. Phase one of the Science Park should occupy an area of eight hectares, with a plot ratio of 2.5 and a maximum building height of 30 metres in order to create a park set sitting with low to medium rise buildings.

Development parameters

6.The Planning Committee has recommended that four multi-tenant buildings should be provided for the following purposes -

  1. administration facilities and general R&D activities;

  2. R&D activities with heavy floor loading facilities;

  3. special information technology facilities; and

  4. laboratory facilities.

7.A block of serviced apartments should also be constructed to provide accommodation facilities for visiting scientists and researchers who are not local residents. A total of 1.6 hectares of land, which could be further divided into smaller plots, should be reserved for lease to anchor tenants who wish to build their own premises to suit their special requirements. (The land reserved for lease to anchor tenants could vary in size in light of the prevailing market demands.) In addition, common facilities such as conference rooms, library, exhibition hall, parking facilities and other amenity facilities should be in place. Commercial facilities such as banks, shops and restaurants should also be provided. Apart from these physical facilities, the Science Park should develop linkages with local and overseas higher education institutions; other Science Parks; and the business, financial and industrial communities in order to facilitate technology transfer and the commercialisation of R & D activities.

Admission criteria

8.The Planning Committee has recommended that the Science Park should be open to all kind of technology-based industries except those mass production-type manufacturing industries. However, it would be up to the future management of the Science Park to decide, in the light of prevailing market demands, on the need or otherwise to target at specific industries. The Planning Committee report envisages that there would be two broad categories of tenants, namely tenants who would rent premises in multi-tenant buildings and anchor tenants who wish to lease a plot of land to purpose-build their own premises.

Institutional arrangement

9.The Planning Committee has recommended that a new statutory corporation should be set up to plan, develop and manage the Science Park. The Corporation would be governed by a Board of Directors who would determine the policy and direction of the Science Park. The Board would be supported by an executive team led by a Chief Executive Officer. Given the lead time required to complete the legislative procedures to establish the Corporation by statute, the Planning Committee has recommended that a wholly government-owned provisional limited company, the Provisional Hong Kong Science Park Company Ltd., should be set up in the interim period to assume the powers and perform the full range of functions of the future statutory corporation. All assets of the company would be transferred to the Corporation once the latter is established. The provisional company shall dissolve on the date when the Corporation comes into existence.

Land grant

10.In order to ensure the financial viability of the Science Park, the Planning Committee has recommended that the land for the development of the Science Park should be granted by the Government to the future Science Park Corporation in phases at nominal premium and with the land formation cost waived.

Land premium and rental charges

11.The Planning Committee report recommends that the premium for the land plots reserved for lease to anchor tenants and rental charges for premises in both the multi-tenant buildings and the residential units should be competitively priced, in order to attract tenants to the Science Park. In particular, the Planning Committee considers that the premium for the land plots for lease should be comparable to that offered by the Hong Kong Industrial Estates Corporation which currently provides fully serviced land at development cost. As regards rental charges for premises in the multi-tenant buildings and the residential units, the report recommends that they should be competitively priced, having regard to comparable market value at the time.

Project estimate for Phase One

12.The project estimate for phase one of the Science Park amounts to $3.64 billion at money-of-the-day (MOD) level, on the assumption that the site is granted to the Science Park Corporation at nominal premium and with land formation cost waived. The project estimate comprises capital expenditure of $3.33 billion and recurrent expenditure of $310 million which will be incurred by the Corporation in its initial seven years of operation before it can become a self-financing entity. As the Planning Committee has pointed out in its report, this project estimate is based on certain planning parameters and assumptions. Nevertheless, they are not meant to be rigid principles which the future Science Park Corporation must follow. The Corporation should be given the flexibility to amend and refine these parameters in the light of actual demand and market situation of the time.

Way forward

13.The case for the early provision of the Science Park in view of the changing economic landscape of Hong Kong and in face of the keen competition from other economies in the Region is fully recognized. In this connection, a site of 22 hectares at the southern tip of the Pak Shek Kok Reclamation Area along Tolo Highway, opposite to the campus of the Chinese University of Hong Kong and adjacent to the Hong Kong Institute of Biotechnology, has already been earmarked for the Science Park. Reclamation is now in progress.

14.Against this background, the Secretary for Trade and Industry's preliminary assessment is that the Planning Committee's report provides a package of broad parameters within which detailed design and planning of the Science Park should proceed. On the basis that the Science Park mission and objective cover both manufacturing and service industries with an emphasis on the technology development, bringing it on course at an early stage would meet the changing needs of Hong Kong's economy. The development parameters proposed also capture the essential facilities, infrastructure and services required.

15.Some of the more detailed recommendations, for example, the project estimate, require further examination. In addition, more detailed design and planning work will have to be carried out in order to take the Science Park project forward. Subject to further examination of the report and the approval of the Chief Executive in Council, our current plan is to seek funding approval from the Finance Committee in early 1998 to enable essential preparatory work such as recruitment of staff and detailed design work to start in 1998/99. Funding approval of expenses for subsequent construction works would be sought when more details of the project are made available in due course.


Trade and Industry Bureau
December 1997