Page 405 of 498
HONG KONG URBAN COUNCIL
449
Within this 3-year period, about 250 of the vacant stalls (or 15%) were vacant for less than 12 months, about 170 (or 10%) vacant for 12 to 24 months, and about 1,230 (or 75%) vacant for 24 to 36 months.
The second part of the question asks for the total rental loss due to the stalls being left vacant in the past 3 years. Since the rent receivable from most market stalls is determined by auction, it would be difficult to estimate accurately the rental loss due to vacant stalls. However, if all the vacant stalls could be leased out at the same rental as the other leased market stalls, it is estimated that the potential rental loss incurred by the Council due to market stalls being left vacant in the past 3 years (i.e., 1993/94, 1994/95, and 1995/96) would be in the region of $116.8M. Members may wish to note, however, that it is unrealistic to expect a 100% let-out rate and operational experience indicates that an 85% to 90% occupancy rate is normally considered reasonable.
The third part of the question asks for the reasons for the market stall vacancies and whether it is because market stalls are reserved for selection by the itinerant hawker licence holders. It is true that the current vacancy situation has arisen, in the main, due to the Itinerant Hawker Licence (IHL) Compulsory Deletion Policy which has been implemented since March 1993 whereby all vacant market stalls are reserved for selection by IHL holders who opt to surrender their licence in exchange for the allocation of a stall in a UC market. The deadline originally set was 31 March 1996, which would have meant that by now, a significant portion of the market stalls would almost certainly have been taken up by some of the remaining IHL holders. However, this date had to be postponed due to a legal challenge. This has meant that virtually all vacant market stalls must still be reserved for the IHL holders and cannot be put up for open auction by the public. To do otherwise would be to go back on Council's published policy commitment. Large sums of money would also have been unnecessarily spent in defending the case in Courts.
There are also other reasons why some UC markets are less popular than the others. These less popular markets with a lower occupation rate are usually older markets. They were built for the purpose of meeting the full resite commitment at that time, without taking full account of factors such as the location and design of the market, and consumers' demand. In other cases, available sites which were allocated to the UC for the provision of markets may not be the most attractive sites from a viability point of view. In yet other cases, for example, the Shau Kei Wan Market, the high vacancy rate is due to the keen competition by a large number of on-street licensed fixed pitch hawkers selling similar commodities in the vicinity of the market. The policy and rules giving rise to such a situation have been revised a long time ago. Such situations will not occur in the future under our present policy. Besides, there are an increasing number of old markets planned for redevelopment, which has necessitated the withholding of vacant stalls in these markets from
Page 405 of 498
Page 405 of 498
Page 405 Page 406
Page 405 of 498
Page 405 of 498
HONG KONG URBAN COUNCIL
449
Within this 3-year period, about 250 of the vacant stalls (or 15%) were vacant for less than 12 months, about 170 (or 10%) vacant for 12 to 24 months. and about 1 230 (or 75%) vacant for 24 to 36 months.
The second part of the question asks for the total rental loss due to the stalls being left vacant in the past 3 years. Since the rent receivable from most market stalls is determined by auction, it would be difficult to estimate accurately the rental loss due to vacant stalls. However, if all the vacant stalls could be leased out at the same rental as the other leased market stalls, it is estimated that the potential rental loss incurred by the Council due to market stalls being left vacant in the past 3 years (i.e. 1993/94, 1994/95 and 1995/96) would be in the region of $116.8M. Members may wish to note, however, that it is unrealistic to expect a 100% let-out rate and operational experience indicates that an 85% to 90% occupancy rate is normally considered reasonable.
The third part of the question asks for the reasons for the market stall vacancies and whether it is because market stalls are reserved for selection by the itinerant hawker licence holders. It is true that the current vacancy situation has arisen, in the main, due to the Itinerant Hawker Licence (IHL) Compulsory Deletion Policy which has been implemented since March 1993 whereby all vacant market stalls are reserved for selection by IHL holders who opt to surrender their licence in exchange for the allocation of a stall in a UC market. The deadline originally set was 31 March 1996, which would have meant that by now, a significant portion of the market stalls would almost certainly have been taken up by some of the remaining IHL holders. However, this date had to be postponed due to a legal challenge. This has meant that virtually all vacant market stalls must still be reserved for the IHL holders and cannot be put up for open auction by the public. To do otherwise would be to go back on Council's published policy commitment. Large sums of money would also have been unnecessarily spent in defending the case in Courts. There are also other reasons why some UC markets are less popular than the others. These less popular markets with a lower occupation rate are usually older markets. They were built for the purpose of meeting the full resite commitment at that time, without taking full account of factors such as the location and design of the market, and consumers' demand. In other cases. available sites which were allocated to the UC for the provision of markets may not be the most attractive sites from a viability point of view. In yet other cases, for example, the Shau Kei Wan Market, the high vacancy rate is due to the keen competition by large number of on-street licensed fixed pitch hawkers selling similar commodities in the vicinity of the market. The policy and rules giving rise to such situation have been revised a long time ago. Such situations will not occur in future under our present policy. Besides. there are an increasing number of old markets planned for redevelopment which has necessitated the withholding of vacant stalls in these markets from
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Page 405 of 498
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