HONG KONG (BLOOMBERG) – Hong Kong’s railway operator MTR Corp said it could build more subsidized housing, as the city struggles to make homes more affordable.
The company is open to finding ways to help solve the housing shortage including building more subsidized apartments in the future, according to Chief Executive Officer Jacob Kam.
“Depending on the government housing policy, we could actually get into building subsidized housing as well as normal private housing,” Kam said in an interview with Bloomberg Television. “As long as we capture enough external value and feed it back into the railway, we are flexible.”
Housing affordability is becoming one of the biggest priorities for the Hong Kong government. Chinese officials have urged local authorities to solve the city’s expensive home prices, a source of social discontent in Beijing’s eyes. Property developers have also been more vocal recently in seeking to address housing issues.
MTR has partnered with developers to build dozens of private housing projects, typically on top of its stations. Many of these developments are popular among buyers for their proximity to the railway. The Pavilia Farm project with New World Development was the most sought after in more than two decades.
Subsidized apartments sell at a lower price than the market level, with the difference paid by the government. Revenue for developers tends to be lower than for private housing.
MTR has been involved in few subsidized housing projects over the years. Its upcoming Siu Ho Wan Depot project on Lantau Island will include such apartments. As for the rail operator’s other businesses, it has seen a “significant recovery” in domestic patronage for transportation and retail, Kam said.
The company is looking forward to the relaxation of border restrictions with mainland China so that it can regain income from cross-border travel, he added.
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