Cyberport interest fizzles
CECILE LEONARD
Monday, August 20, 2001
HONG KONG -- When entrepreneur Richard Li unveiled plans for the Cyberport, a strategic cluster of high-technology companies nestled along a strip of Hong Kong's waterfront, it was the height of the dot-com frenzy and everyone seemed eager to get a piece of the action.
Now, two years later, the tech boom has fizzled, and so has much of the enthusiasm for the $2.03-billion (U.S.) project.
Sitting on a huge expanse of waterfront real estate about 10 kilometres southwest of Hong Kong's central business district, it is just one of many government-led projects across Asia that aim to jump-start local high-tech industries, all involving some element of government subsidies.
But interest in the project has faded. Many potential tenants who signed preliminary applications to be a part of the Cyberport have backed out altogether, and some of the few big names still in, such as Microsoft Corp., are sounding less confident.
The government still hopes to host about 250 companies once the Cyberport is completed by the end of 2003. Among the 15 multinationals that expressed interest when the project was introduced, some recently submitted applications to become tenants, such as Oracle Corp. An Oracle spokesman said the company was attracted in part by the cheap rents.
The blueprints for Cyberport are impressive. They include low-rise office buildings, which will account for less than half the total area, a shopping mall, hotel and apartments, exhibition and trade-show facilities, library and facilities including a fibre-optic network, high-speed Internet access and multimedia equipment. It is even an appropriate location: Telegraph Bay, where the first underwater telegraph cable entered Hong Kong more than 100 years ago.
Mr. Li's company, Pacific Century CyberWorks Ltd., is building the complex. The city's dominant telecommunications company will hand the offices to the government without charge and will try to recoup its costs from selling about 2,700 apartments to be built on the site. The deal pleased both the government and PCCW but enraged rival property developers when it was awarded without tender.
The Cyberport sparked accusations of favouritism because Mr. Li, who put forward the idea, is the son of influential businessman Li Ka-shing. Hong Kong officials also came in for criticism that the Cyberport's below-market office rents amounted to a subsidy to high-tech companies, an apparent reversal of the city's claim that it wouldn't use subsidies to steer the economy.
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