LCQ9: Long-term development of the retail industry
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Question:
Regarding the long-term development of Hong Kong's retail industry, will the Government inform this Council:
(1) of the total floor area of the retail shops in Hong Kong in each of the past 15 years, with a breakdown by the capacity (i.e. private entities, the Hong Kong Housing Authority and the Hong Kong Housing Society) of the owners of the properties where the shops were located;
(2) of the projected total floor area of the retail shops in Hong Kong in each of the coming 10 years, with a breakdown by the capacity (i.e. private entities, the Hong Kong Housing Authority and the Hong Kong Housing Society) of the owners of the properties where the shops are located;
(3) whether it assessed, in the past five years, the demand for floor areas of retail facilities and shops; if so, of the assessment method and outcome;
(4) of the percentage of tourists' spending in Hong Kong in the value of total retail sales in each of the past five years (with a tabulated breakdown by major type of retailers);
(5) given that the Planning Department conducted in 1996 and 2005 respectively the Review on Shopping Habits (which comprised surveys on households and retailers as well as structured meetings with major stakeholders) with a view to understanding the shopping habits of Hong Kong people and the perceived retail hierarchy, whether the authorities have plans to conduct such a review afresh to provide reference information for the long-term development of the retail industry; if so, of the details; if not, the reasons for that; and
(6) given that in announcing the outcome of the Review on Shopping Habits conducted in 2005, the authorities indicated that online shopping was not prevalent and was not expected to become popular in the future in Hong Kong, whether the authorities have plans to conduct in-depth studies on online shopping; if so, of the details; if not, the reasons for that?
Reply:
President,
The retail industry, constituting one of the major economic activities in Hong Kong, is categorised as a commercial use in terms of land use. The Government has been monitoring the market demand for commercial floor space and is committed to increasing the supply of sites, space and hardware for economic uses in order to facilitate the developments of different economic activities and maintain Hong Kong's competitiveness. At present, the Government does not have any specific policy for retail as part of the commercial activities. The development and choice of commercial uses for economic land and floor space would more appropriately be market-driven, which allows business operators to respond to the fast-changing market situations and make timely and flexible decisions. The existing planning system, including the statutory plans, has embodied sufficient flexibility to facilitate retail activities in many land use zones. For example, "retail shops" is an always permitted use on the land zoned "Commercial" in the Central Business District and major shopping areas. In the "Residential (Group A)" zones, retail shops are also always permitted in the lower three storeys of buildings. Developers can also propose change of land use for sites considered suitable for development of retail business via planning applications.
Having consulted the Commerce and Economic Development Bureau, Innovation and Technology Bureau, Office of the Government Chief Information Officer, Rating and Valuation Department (RVD), Census and Statistics Department (C&SD), Housing Department (HD) and Planning Department (PlanD), my replies to different parts of the question are as follows:
(1) and (2) According to the information of RVD, statistics of the total stock for the private retail premises at the year-end of 2003-2016 are listed in Table 1 below.
Table 1: Private Retail – Stock at Year-end (2003 - 2016)*
Floor Area ('000 sq m)#
| District | 2003 | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 | 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 |
| Central & Western | 983 | 976 | 977 | 975 | 968 | 968 | 972 | 972 | 979 | 989 | 982 | 986 | 992 | 964 |
| Wan Chai | 821 | 825 | 826 | 804 | 809 | 813 | 812 | 828 | 863 | 893 | 900 | 900 | 920 | 972 |
| Eastern | 651 | 651 | 651 | 651 | 652 | 657 | 656 | 658 | 658 | 657 | 658 | 659 | 663 | 617 |
| Southern | 183 | 184 | 186 | 187 | 187 | 187 | 189 | 189 | 195 | 203 | 202 | 203 | 202 | 202 |
| Hong Kong | 2638 | 2636 | 2640 | 2617 | 2616 | 2625 | 2628 | 2647 | 2696 | 2742 | 2742 | 2748 | 2778 | 2755 |
| Yau Tsim Mong | 1523 | 1562 | 1565 | 1603 | 1616 | 1618 | 1674 | 1707 | 1719 | 1725 | 1728 | 1733 | 1731 | 1754 |
| Sham Shui Po | 559 | 562 | 569 | 572 | 579 | 587 | 587 | 588 | 588 | 592 | 594 | 602 | 611 | 611 |
| Kowloon City | 631 | 591 | 592 | 601 | 601 | 603 | 616 | 610 | 611 | 617 | 615 | 614 | 623 | 630 |
| Wong Tai Sin | 284 | 282 | 284 | 286 | 287 | 288 | 288 | 305 | 295 | 311 | 312 | 312 | 310 | 316 |
| Kwun Tong | 553 | 579 | 581 | 637 | 648 | 654 | 574 | 577 | 577 | 597 | 592 | 595 | 629 | 636 |
| Kowloon | 3549 | 3576 | 3590 | 3699 | 3730 | 3751 | 3739 | 3786 | 3790 | 3841 | 3841 | 3856 | 3904 | 3947 |
| Kwai Tsing | 313 | 313 | 313 | 313 | 309 | 312 | 312 | 312 | 312 | 313 | 314 | 315 | 322 | 322 |
| Tsuen Wan | 416 | 435 | 443 | 444 | 464 | 459 | 468 | 453 | 455 | 455 | 455 | 462 | 465 | 465 |
| Tuen Mun | 373 | 375 | 378 | 378 | 378 | 386 | 378 | 378 | 378 | 397 | 397 | 395 | 394 | 396 |
| Yuen Long | 404 | 404 | 406 | 406 | 413 | 413 | 408 | 421 | 424 | 424 | 429 | 427 | 431 | 469 |
| North | 214 | 214 | 213 | 214 | 215 | 215 | 214 | 215 | 215 | 215 | 215 | 228 | 227 | 227 |
| Tai Po | 209 | 209 | 211 | 211 | 211 | 211 | 211 | 211 | 211 | 210 | 213 | 212 | 216 | 216 |
| Sha Tin | 428 | 432 | 432 | 432 | 437 | 438 | 441 | 441 | 441 | 442 | 451 | 451 | 463 | 469 |
| Sai Kung | 251 | 253 | 255 | 271 | 271 | 271 | 272 | 272 | 285 | 285 | 285 | 290 | 292 | 305 |
| Islands | 187 | 190 | 191 | 209 | 286 | 290 | 292 | 293 | 293 | 297 | 295 | 295 | 300 | 299 |
| New Territories | 2796 | 2826 | 2842 | 2878 | 2983 | 2996 | 2996 | 2995 | 3015 | 3037 | 3054 | 3075 | 3109 | 3168 |
| Overall | 8982 | 9038 | 9073 | 9195 | 9330 | 9371 | 9363 | 9429 | 9500 | 9621 | 9637 | 9679 | 9791 | 9870 |
* RVD does not have the relevant statistical data in 2002 or the breakdown by ownership.
# Measured on the basis of "internal floor area" which is defined as the area of all enclosed space of the unit measured to the internal face of enclosing external and/or party walls.
Notes: Private retail stock is based on rating records. The sum of individual items might not add up to the respective total because of rounding.
Source: RVD
Retail as part of the commercial activities is an industry with ever-changing market conditions, and the use of economic sites and floor space for retail purposes is a market-driven commercial decision. The Government does not have a forecast of retail floor space in the future.
On the other hand, from 2006-07 till now, the total internal floor area of retail shops under the Hong Kong Housing Authority (HA) is listed in Table 2 below. Since HA only maintains the relevant information from 2006-07 onwards, we are unable to provide the information before then.
Table 2
| Year | Total Internal Floor Area of Retail Shops under HA (sq m) |
| 2006-07 | 141 800 |
| 2007-08 | 153 400 |
| 2008-09 | 145 200 |
| 2009-10 | 154 200 |
| 2010-11 | 155 000 |
| 2011-12 | 163 600 |
| 2012-13 | 185 300 |
| 2013-14 | 192 900 |
| 2014-15 | 197 100 |
| 2015-16 | 201 700 |
| 2016-17 | 213 000 |
The estimated total internal floor area of retail shops under HA for the period from 2017-18 to 2020-21 is listed in Table 3 below. However, the figures are subject to change due to alternation or renovation of existing premises or change in the detail designs of new projects. For HA projects estimated for completion in 2021-22 and afterwards, most of them are still at the stage of preliminary planning and design, thus we are unable to provide the relevant information at this stage.
Table 3
| Year | Estimated Total Internal Floor Area of Retail Shops under HA (sq m) |
| 2017-18 | 226 900 |
| 2018-19 | 239 500 |
| 2019-20 | 254 800 |
| 2020-21 | 273 400 |
The total internal floor area of commercial (including retail) use in properties under the Hong Kong Housing Society (HKHS) in the past 15 years and the estimated total internal floor area of commercial (including retail) use in properties under HKHS in the coming 10 years are listed in Tables 4 and 5 below respectively.
Table 4
| Year | Total Internal Floor Area of Commercial Use under HKHS (sq m) |
| 2002-03 | 92 703 |
| 2003-04 | 92 703 |
| 2004-05 | 92 703 |
| 2005-06 | 92 703 |
| 2006-07 | 92 703 |
| 2007-08 | 92 703 |
| 2008-09 | 92 703 |
| 2009-10 | 92 703 |
| 2010-11 | 92 703 |
| 2011-12 | 92 703 |
| 2012-13 | 92 703 |
| 2013-14 | 93 312 |
| 2014-15 | 93 312 |
| 2015-16 | 95 759 |
| 2016-17 | 98 913 |
Table 5
| Year | Estimated Total Internal Floor Area of Commercial Use under HKHS (sq m) |
| 2017-18 | 100 077 |
| 2018-19 | 100 077 |
| 2019-20 | 101 217 |
| 2020-21 | 101 866 |
| 2021-22 | 101 866 |
| 2022-23 | 107 256 |
| 2023-24 | 109 009 |
| 2024-25 | 109 009 |
| 2025-26 | 110 269 |
| 2026-27 | 110 269 |
(3) and (5) PlanD conducted a "Study on Shopping Habits" in 1995 with regard to the development of the society at that time. The aim of the study was primarily to look into the shopping habits and trends of Hong Kong people at that time in order to facilitate appropriate revisions to the standards and guidelines on retail facilities in Chapter 6 of the Hong Kong Planning Standards and Guidelines (HKPSG). Subsequently, PlanD conducted another study called the "Review on Shopping Habits" in 2004 to identify the shopping choice habit and expectation of Hong Kong people. It also explored the new trends in the retail sector at that time, including assessment of the impact of the cross-boundary shopping activities and new shopping modes such as e-shopping, on the provision of retail facilities, in order to facilitate further revision of the relevant planning standards and guidelines.
In light of the findings and recommendations of the two studies on shopping habits, the standards and guidelines on retail facilities in Chapter 6 of HKPSG were revised in 1998 and 2009 as appropriate. The revisions included setting out the shopping preference and trend of the general public; the retail hierarchy; the broad approach for estimating the demand for retail facilities; and the main considerations of retailers and developers in the development of retail facilities. The guidelines stress that retail development is primarily market-driven and should be effectively addressed by the private sector in response to market situation. In this connection, the relevant planning standards and guidelines mainly serve as a reference and should be applied with flexibility. At present, the relevant bureau and departments do not have any plan to further revise the said standards and guidelines concerning retail facilities, and PlanD has no plan to carry out another study on shopping habits. The Government will continue to make reference to the data compiled by C&SD and relevant market researches to closely monitor the development of retail industry in different aspects.
It is noteworthy that the above studies were not intended to assess the demand for retail facilities and their floor space. As mentioned above, the Government has been working vigorously to increase land supply for different economic activities, including land and floor space for commercial uses. The existing planning system has provided retail business operating on commercial floor space with adequate flexibility. Since the use of commercial floor space for retail use is a market-driven commercial decision, solely assessing the demand for retail floor space is not meaningful.
(4) According to the information of C&SD and the Hong Kong Tourism Board, the total spending on goods in Hong Kong by visitors is estimated to be around 35 per cent to 42 per cent of the total value of retail sales in Hong Kong from 2012 to 2016 (Table 6 below). In addition, as the categorisation of the total visitors' spending on goods is different from that of the total values of retail sales, the respective share by broad type of retail outlet is not available.
Table 6
| HK$ (million) | |||||
| 2012 | 2013 | 2014 | 2015 | 2016 | |
| (i) Total spending on goods in Hong Kong by visitors | 158,131 | 189,345 | 208,883 | 182,833 | 150,889 |
| (ii) Total value of retail sales | 445,498 | 494,451 | 493,236 | 475,156 | 436,623 |
| Share (i)/(ii): | 35% | 38% | 42% | 38% | 35% |
(6) C&SD has conducted a series of the "Thematic Household Survey on Information Technology Usage and Penetration" on an annual basis since 2000. Information on usage of online purchasing services has been collected once every two years and the latest round of the survey was conducted during April to July 2016. Based on data collected through the latest round of the survey, some 1 701 200 persons aged 15 and over in Hong Kong had used online purchasing services for personal matters during the 12 months before enumeration, constituting 27.8 per cent of all persons aged 15 and over in Hong Kong.
On the other hand, C&SD has also conducted a "Survey on Information Technology Usage and Penetration in the Business Sector" to collect information relating to information technology usage and penetration from establishments in the business sector. The survey was conducted annually from 2000 to 2009, and has been conducted once every two years since 2013. Based on data collected through the latest round of the survey, the value of business receipts from selling of goods, services or information through electronic means amounted to $400.6 billion in 2014, representing 4.7 per cent of the total business receipts of all selected industry sectors in 2014.
Ends/Wednesday, May 17, 2017
Issued at HKT 14:30
Issued at HKT 14:30
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