The redevelopment of Hong Kong’s old Kai Tak airport on the Kowloon Peninsula into a new residential area has captivated public interest since the government first started selling it as residential sites back in 2014. With eight now sold and a further 25 still in the pipeline, Kai Tak is the government’s largest source of residential land supply over the next decade.

Housing prices remain stubbornly high, so the government has been under increasing pressure to deliver on residential land supply. One proposal is to increase the plot ratio of all remaining unsold sites at Kai Tak. Under the latest proposal, this would increase the total number of private flats from 39,000 to 49,900 which, in turn, would increase the population by 29,000 to 134,000- representing about 2% of the city’s overall population. This would bring the population density at Kai Tak to 41,460 persons per sq km, on par with districts such as Sham Shui Po and Kowloon City.

Looking at the government’s latest proposal, it becomes evident that the new district is going to see an increase in the number of small flats given that the number of extra flats planned far exceeds the gain in plot ratio. Having smaller flats, however, may not translate into fewer people living in the area, as the number of occupants per flat is likely to remain the same at around 2.7 (See Table 1).

To get a sense of just how small units could become, we can take a look at what is being offered for sale at One Kai Tak, currently the only private residential project being marketed in the area. Flat sizes in this development range from 372 to 1,663 sq ft, on Saleable Area. To ensure that flats do not become too small—the smallest flats currently being marketed in Hong Kong are just 128 sq ft—developers could reduce the size of larger flats. However, given that flats over 1,000 sq ft account for just 4% of total stock at One Kai Tak, it would appear that most of the gains will need to be achieved by reducing the floor area of more average sized flats; of which around 70% of flats at One Kai Tak are less than 567 sq ft.

Having smaller flats may see Kai Tak develop as a mass market given the palatable lump sums involved. It also means the rental and sales market may become more competitive. But the higher density would also create problems for the government. With more families living in the area, the government will need to ensure adequate community facilities and amenities to accommodate the needs of residents. This could potentially derail the government’s plans to rezone a handful of Government Institution or Community (GIC) sites in Kai Tak to commercial use.

While increasing the plot ratio from 5.0 to 5.9 may see Kai Tak develop differently from what was originally envisioned, the density of the new residential area will still be lower than elsewhere in Hong Kong where plot ratios range from 6.0 to 10.0.

Table 1  Kai Tak development parameters
Source: JLL

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