(19 January 2017, Hong Kong) The West Kowloon Cultural District Authority (WKCDA) welcomes the Enhanced Financial Arrangement (EFA) for the West Kowloon Cultural District (WKCD) announced by the Chief Executive of the Hong Kong Special Administrative Region (HKSAR), Mr C Y Leung, in his Policy Address on 18 January 2017. This EFA provides certainty over WKCDA’s long term financial capability to fulfil its objectives to develop an integrated arts and cultural hub. It enables WKCDA to build and operate the planned facilities on a sustainable basis thereby providing a wider range of attractions for both people of and visitors to Hong Kong.
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Under the EFA, the WKCDA will be granted the development rights over the hotel/office/ residential (HOR) portion of the WKCD, involving a total gross floor area (GFA) of 366,620m2. This will allow the WKCDA to share rental income with the private sector under a Build-Operate-Transfer (BOT) model. Under this arrangement, the Government will receive upfront payments to be determined through competitive tender from private developers, except for the development package with the Exhibition Centre. The WKCDA will retain the ownership of the HOR portion and upon expiry of the BOT agreements, the control of premises will revert to the WKCDA, thus ensuring that the District as a whole remains an asset for the community in the long term.
The U-shaped site for hotel and office uses, (with a GFA of 81,066 m2 out of the total HOR GFA mentioned above) will be packaged with the adjoining multi-purposed Exhibition Centre as a joint development forming an Exhibition Hub. To ensure transparency, all development packages, including the one for the Exhibition Hub, will be undertaken through open and competitive tendering.
Under the BOT model, the ownership of the land and premises will be retained by WKCDA. This will generate a steady income stream and enhance the long term financial sustainability of WKCDA. The WKCDA will also maintain an overview on the design and management of the entire District thus delivering a cohesive project in a holistic and integrated manner.
By leveraging the development rights granted to WKCDA under the EFA, funds may be raised for the building of the remaining planned Core Arts and Cultural Facilities. The WKCDA’s plan is to first move forward with the construction and operation of the Music Centre and thereafter other remaining facilities.
“The EFA will provide sufficient funding resources to WKCDA to meet its requirements now and into the future thus avoid being a financial burden to the community,” said Mr Duncan Pescod, Chief Executive Officer of WKCDA.
“The EFA will place WKCDA on a sound financial footing, able to fulfil its roles and functions under the WKCDA Ordinance. The arts and cultural community will benefit from the early development of the WKCD as a vibrant cultural hub, an attractive place for audiences including tourists. The wider community and business sectors in Hong Kong will benefit from the enhanced international reputation, tourism, employment and business opportunities as well as economic, social and, cultural benefits the WKCD will bring, ” Mr Pescod added.