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To: Jill who wrote (107139)	3/4/1999 2:32:00 PM
From: Dorine Essey	Respond to of 176387

-------------------------------------------------------------------------------- By David Lawder HONG KONG, March 4 (Reuters) - Hong Kong's flashy $13 billion "Cyberport" project will provide the territory with a marketing tool for its plan to jump start its information technology industry, analysts said on Thursday. The project will create a strategic cluster of high technology information services companies in a waterfront business park outfitted with the latest in optical fibre communications infrastructure and multimedia facilities. It is the brainchild of 32-year-old Richard Li, the youngest son of property tycoon Li Ka-shing. The younger Li's Pacific Century Group will spearhead the development of the project and is expected to raise the bulk of the funding from private sources. Analysts said the government will support the project through land subsidies. It will be located on a prime 26-hectare site on the western side of Hong Kong Island, near Hong Kong University. "Hong Kong has to switch its focus on property to other areas, so I think it's a great idea," said Eric Yuen, property analyst with South China Securities. "With the support of the government, it will have a bigger chance of success." He added the project would provide a focus for government efforts to attract new high-technology companies to Hong Kong. Giving the project a head start is the fact that eight major companies have expressed intentions to become anchor tenants. These include Li's Pacific Convergence Corp, International Business Machines Corp IBM.N, Hewlett-Packard HWP.N, Yahoo Inc YHOO.O, Oracle Corp ORCL.O, Sybase Inc SYBS.O and Softbank Corp 9984.T. The Cyberport is expected to be opened in phases starting in 2002 with completion in 2007. The government anticipates that some 12,000 people will ultimately work at the facility. The announcement is expected to boost property values in nearby areas by up to 15 percent, analysts said. Shares in Shun Tak Holdings 0242.HK, the major partner in a nearby housing development, rose 8.4 percent to HK$1.55 on Thursday on news of the project. Unclear at the moment is the role Li Ka-shing's flagship company, Cheung Kong (Holdings) Ltd 0001.HK, would take in the project. Part of the site was earmarked for housing, and Yuen said Cheung Kong would have an inside track for winning the housing development rights. But Dresdner Kleinwort Benson property analyst, Terry Ip, said he believes Cheung Kong affiliate Hutchison Whampoa Ltd 0013.HK would be a better fit for the project. "Hutchison is more involved in the infrastructure side, so it would be a better candidate than Cheung Kong," Ip said. He also noted that Hutchison Telecom would be able to provide the sophisticated broadband telecommunications facilities for the project. Hutchison has raised nearly HK$15 billion in cash since late January, including the sale of part of its stake in British mobile phone group Orange Plc ORA.L. Hong Kong's information technology chief, KC Kwong, is scheduled to provide more details about the project at a news conference on Friday. But some analysts said the Cyberport would simply attract companies already existing in Hong Kong to new quarters with cheap subsidized rents. "Basically, most of these companies already are in Hong Kong. They're just getting a cheaper place to go," he said of the eight prospective anchor tenants. 2843 6321; Fax (852) 2845 0636)) ((Email: hongkong.newsroom@reuters.com)) REUTERS Rtr 14:08 03-04-99 Copyright 1999, Reuters News Service --------------------------------------------------------------------------------