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Construction in Hong Kong Key Trends and Opportunities to 2021

LONDON, March 2, 2017 /PRNewswire/ -- Synopsis

In real terms, Hong Kong's construction industry registered positive growth during the review period (2012–2016). Construction activity was weak during the 2013–2016 period due to the economic slowdown in China and the resulting impact on trade relations. Consequently, poor business confidence had a negative effect on investments.

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Nevertheless, government efforts to stabilize economic growth through infrastructure and residential construction investments contributed to the industry's positive review-period growth.

The industry is expected to expand at a slow pace over the forecast period (2017–2021). This is mainly due to the prevalence of global economic uncertainty, on account of the new anti-trade policies to be adopted against China by President Trump. Hong Kong's trade dependence on China is subsequently expected to adversely affect its economy. Efforts to strengthen the economy by focusing on developing the country's commercial, housing, tourism and manufacturing sectors are expected alleviate the problem, although they will not solve it.

Government flagship programs, such as the Long-Term Housing Strategy (LTHS), Climate Action Plan 2030, Railway Development Strategy (RDS) and Hospital Development Program are expected to support the expansion of the industry.

The industry's output value in real terms increased at a review-period compound annual growth rate (CAGR) of 3.96%, and is expected to post a forecast-period CAGR of 2.19%.

Summary
Timetric's 'Construction in Hong Kong, Key Trends and Opportunities to 2021' report provides detailed market analysis, information and insights into Hong Kong's construction industry, including:

- The Hong Kong construction industry's growth prospects by market, project type and construction activity

- Analysis of equipment, material and service costs for each project type in Hong Kong

- Critical insight into the impact of industry trends and issues, and the risks and opportunities they present to participants in Hong Kong's construction industry

- Profiles of the leading operators in Hong Kong's construction industry

- Data highlights of the largest construction projects in Hong Kong

Scope
This report provides a comprehensive analysis of the construction industry in Hong Kong. It provides:

- Historical (2012-2016) and forecast (2017-2021) valuations of the construction industry in Hong Kong using construction output and value-add methods

- Segmentation by sector (commercial, industrial, infrastructure, energy and utilities, institutional and residential) and by project type

- Breakdown of values within each project type, by type of activity (new construction, repair and maintenance, refurbishment and demolition) and by type of cost (materials, equipment and services)

- Analysis of key construction industry issues, including regulation, cost management, funding and pricing

- Detailed profiles of the leading construction companies in Hong Kong

Reasons To Buy
- Identify and evaluate market opportunities using Timetric's standardized valuation and forecasting methodologies.

- Assess market growth potential at a micro-level with over 600 time-series data forecasts.

- Understand the latest industry and market trends.

- Formulate and validate strategy using Timetric's critical and actionable insight.

- Assess business risks, including cost, regulatory and competitive pressures.

- Evaluate competitive risk and success factors.

Key Highlights
- In January 2016, the government announced plans to develop the Central Kowloon Route (CKR) highway project in the Kowloon region. The project includes the construction of a 4.7km-long dual three-lane trunk road, which will connect the West Kowloon and Kai Tak development areas. Its main aim is to reduce traffic congestion along the east-west corridors in Central Kowloon. The project is expected to be completed in 2023.

- In 2015, the government granted approval to the country's Airport Authority to develop a third runway at the Asian financial center's airport. The project includes the construction of a new runway, a third runway concourse, aprons and taxiways, parking facilities, a baggage handling system, an automated people mover, and the expansion of Terminal 2 across 650.0ha of reclaimed land. It is scheduled for completion in 2023.

- The government's focus on the development of the country's healthcare infrastructure is expected to support industry growth over the forecast period. As a part of the 2016–2017 federal budget, the government allocated a provision of HKD200.0 billion (US$25.8 billion) to the Hospital Authority in order to implement a hospital development program for 2016–2026. Under the program, the authority will upgrade various healthcare facilities, including the Grantham hospital, the Kwong Wah hospital, the Lai King building at the Princess Margaret hospital, the United Christian hospital, the North District hospital, the Queen Mary hospital, operating theatres at the TuenMun hospital, the Kwai Chung hospital, the Our Lady of Maryknoll hospital and the Prince of Wales hospital until 2026.

- In a bid to address the issue of poor waste management, the government launched a blueprint for the sustainable use of resources in 2013. Through the plan, it aims to reduce the amount of waste dumped in landfills per capita from 1.3kg in 2011 to 1.0kg in 2017 and 0.8kg by 2022.

- In a bid to boost construction activity in the residential and commercial sector, in February 2016 the government announced the Land Sale Program, under which it will supply land to develop 29 private residential sites consisting of 19,000 housing units by 2017. It also plans to issue 560,000m2 of land for the construction of commercial and office buildings in Kowloon Bay and Kwun Tong.

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