Certainty and Discretion in Planning Control: A Case Study of Office Development in Hong Kong

Abstract

Hong Kong's planning control system entails a framework of statutory zoning plans and a discretionary permission process. Through examining past planning decisions on urban office development applications between 1988 and 1997, this paper explores whether this 'hybrid' system provides both certainty for development capital and flexibility in administrative control. Our study concludes that the Hong Kong system offers considerable certainty, although the decision-making criteria of the development controllers tend to deviate from the planning policy applicable to our application cases. Technical merits of the development schemes are found to be necessary, but not sufficient conditions in securing planning permissions. The rejection reasons given by the planning authority apparently disguise their real concerns. Market forces also affect planning control decisions.

The Impact of Building Control on Urban Planning and Building Management in Hong Kong

“…The high-density way of urban development is inevitable in Hong Kong due to shortage of land [15]. Each improvement of building control is made to cater to these needs [16].…”

Urban planning in office markets: A methodological approach

“…Conversely, in a rising competitive environment, the future of cities strictly depends on their ability to keep the current strategic services, and to attract new office developments (Ihlanfeldt and Raper, 1990). Moreover, municipal planning holds a set of social functions, including the removal of negative externalities, a better provision of supportdecision data, and the promotion of the public interest namely through redistribution of public costs and benefits (Klosterman, 1996;Tang et al, 2000). In order to reach these goals planning, through parameter setting, licensing control, and distribution of surplus-values, shall assure the availability of property for the different kinds of functional uses at acceptable prices, prevent excessive profits upstream and downstream the trade of development land, and guarantee free initiative of developers, builders and sellers (Rebelo, 2010).…”

“…As municipal authorities are, often, landowners, their role in land use control and management is especially important, and it will impact both private property and real estate markets. In many cities, whenever private plots reach disproportionate prices, city councils put on the market their own alternative land parcels (Rebelo, 2009a;Tang et al, 2000). This provides for a better market regulation and control over price and rent levels, despite the uncertainties that underlie development processes.…”

“…The United States of America, Canada and diverse LatinoAmerican countries manage to indirectly control real estate price and rent levels (Rebelo, 2009a) through different taxation devices on surplus-values -that span from the traditional taxes to development rates, using different percentages and taxation basis, and resorting to diverse urban policy regulations. Even the development licenses issued by planning responsible people -that may either be more flexible or more rigid, accurate and predictable 6 -shape investments, market characteristics, and the values of the urban built environment (Tang et al, 2000). Different planning systems rely on free market performance, despite bounded by municipal interventions -in what concerns, namely, development of urban land, public housing provision, and private property development -, as is the case of Hong Kong (Schiffer, 1983(Schiffer, , 1991Smart, 1990;Cuthbert, 1991a,b;Lai, 1995;Booth, 1996;Yu, 1997;Tang et al, 2000) and Portugal (Pardal, 2006).…”

“…Even the development licenses issued by planning responsible people -that may either be more flexible or more rigid, accurate and predictable 6 -shape investments, market characteristics, and the values of the urban built environment (Tang et al, 2000). Different planning systems rely on free market performance, despite bounded by municipal interventions -in what concerns, namely, development of urban land, public housing provision, and private property development -, as is the case of Hong Kong (Schiffer, 1983(Schiffer, , 1991Smart, 1990;Cuthbert, 1991a,b;Lai, 1995;Booth, 1996;Yu, 1997;Tang et al, 2000) and Portugal (Pardal, 2006). In these cases, planning decisions are framed by zoning and land use ordinances, but licensing processes are often discretionary.…”