In a village on Hong Kong\u2019s outskirts, Wong Chin Ming inspects zucchini, watermelons, cherry tomatoes and kale growing in his greenhouses. For 19 years he\u2019s been raising crops here on the site of what was once a factory. Soon his farm will be wiped off the map to make way for a massive development, which China hopes will be Hong Kong\u2019s answer to Silicon Valley. The government is setting aside 300 square kilo\u00admeters (116 square miles) for the project, an area more than twice the size of San Francisco.<\/p>\n
It\u2019s called \u201cNorthern Metropolis<\/a>,\u201d yet, for now, it\u2019s anything but. Hong Kong\u2019s hinterland is a hodgepodge of sleepy hamlets, apartment blocks and stray dogs. Rusty fences surround warehouses, abandoned cars lie in bushes, and scores of cabins built to quarantine<\/a> patients during the Covid-19 \u00adpandemic sit empty. Northern Metropolis won\u2019t grow organically over decades like California\u2019s storied tech hub near Stanford University or the glittering skyscrapers of Hong Kong, where companies and citizens had enjoyed greater autonomy from Chinese Communist Party rule before the government cracked down<\/a> in 2020.<\/p>\n Real estate developers are privately expressing reservations about investing in Northern Metropolis out of fear of making huge financial commitments amid a steep decline in Hong Kong\u2019s property values<\/a>. Conservationists question the environmental impact, and some local residents don\u2019t want to leave their home. But with dissent in Hong Kong now severely restricted, citizens from all walks of life are resigned to change. The government says Northern Metropolis is set to displace 4,500 households so far. \u201cIf they have to develop this place, we can\u2019t stop it from happening,\u201d Wong says of his farm. \u201cWe will just take it as it comes.\u201d<\/p>\n Hong Kong\u2019s former leader, Carrie Lam, first proposed Northern Metropolis in 2021 as a way to increase the supply of land for development. Beijing had expressed frustration that homes in the city were the world\u2019s least affordable. The Hong Kong government spent the next few years planning for the area, which makes up one-third of the city.<\/p>\n Northern Metropolis will be built on land along the Shenzhen River, which separates Hong Kong from the Chinese mainland and contains seven border crossings. Its blueprint divides the development into four zones: technology, logistics, border trade and ecotourism. There will be new subway stations, including a cross-border rail line to Shenzhen, China\u2019s third-largest city by gross domestic product. Official plans call for buildings with cutting-edge tech companies and research facilities as tenants and a more than doubling of the area\u2019s population. \u201cAs an investment crucial to the social and economic development of Hong Kong, the Northern Metropolis has topped the Government\u2019s agenda,\u201d the Hong Kong administration says in a statement.<\/p>\n The project has taken on urgency because the city\u2019s traditional economic pillars, finance<\/a> and real estate<\/a>, are faltering as tension grows between China and the West, whose often conflicting interests Hong Kong has long been adept at balancing<\/a>. Given the world\u2019s growing geopolitical conflicts, \u201cwe need to diversify in terms of our economic engines,\u201d says Kathy Lee, the Hong Kong-based head of research at Colliers International Group Inc., a real estate investment company.<\/p>\n Northern Metropolis could align the city even more with the mainland and the economic goals of Chinese President Xi Jinping. The development will help the city further integrate into the Greater Bay Area, a region encompassing 11 southern Chinese cities, Lee says. It could also be used as a platform to export high-end Chinese \u00adtechnologies, by registering them in the city, according to Carlos Lo, a professor in the school of governance and policy science at the Chinese University of Hong Kong. Many countries consider the city as less of a threat than mainland China. \u201cHong Kong has to find a new model to revive the economy,\u201d he says. \u201cThe government can\u2019t go back to how things were run in the good old days.\u201d<\/p>\n Hong Kong authorities expect the city\u2019s rich families<\/a> to invest in Northern Metropolis. In the city, the government owns land, and companies buy the right to develop it for a set time, usually 50 years. No one knows how much Northern Metropolis will cost. The government has put the figure in the tens of billions of dollars, but other estimates have been far higher.<\/p>\n At a meeting in Shenzhen late last year, Xia Baolong, the top Chinese official overseeing Hong Kong, urged a group of tycoons and executives to take \u201cconcrete action\u201d to support the city\u2019s growth and participate in projects, including Northern Metropolis. Steve Tsang, director of a China research center at SOAS University of London, describes Beijing\u2019s attitude: \u201cIf the business elites<\/a> of Hong Kong do not make contributions to the economy as Beijing deems appropriate, there is no reason why they need to be well treated.\u201d<\/p>\n The costly initiative \u201ccomes at an inappropriate timing when everyone needs cash,\u201d says Hannah Jeong, head of valuation and advisory services in Hong Kong for real estate company CBRE Group Inc. Home values in the city are hovering at the lowest in nine years, and office rents<\/a> have declined 40% since their peak in 2019.<\/p>\n There\u2019s another reason developers might find investing in Northern Metropolis unattractive. The government, facing deficits<\/a>, is testing the idea of shifting more costs to private companies in three invitations to make bids. They\u2019ll be responsible for electricity, water pipes and other infrastructure, which the government formerly provided.<\/p>\n Property companies have raised concerns with the government about this change, according to people familiar with the discussions. Building infrastructure could add years to projects, making it hard for developers to assess land prices and risks, according to Patrick Wong, a senior analyst with Bloomberg Intelligence. \u201cIt\u2019s a big problem,\u201d says Wong, who expects developers to be cautious in submitting bids.<\/p>\n If local developers balk at such large investments when businesses are weak, Chinese state-owned companies, which have more access to cash, will have a significant presence in Northern Metropolis, CBRE\u2019s Jeong says. The government says it\u2019s considering developers\u2019 feedback and could ease their burden by offering more pay-as-you-build and other attractive arrangements.<\/p>\n \u201cWe believe that the packages to be tendered would be of good commercial interest to the market,\u201d it says in its statement. About two dozen companies, including Hong Kong and mainland Chinese developers, contractors, conglomerates and an e-commerce logistics company, have expressed interest in making offers under the process the government is testing. Bidding starts in the second half of this year.<\/p>\n Brian Wong of Liber Research Community, a think tank in Hong Kong, questions the environmental cost of Northern Metropolis. The area \u201chas a lot of distinct natural and human landscapes, and it would be a waste if those landscapes are destroyed for a development that doesn\u2019t come to full fruition,\u201d he says. The government says, when possible, it\u2019s trying to preserve active farmland and is turning fallow fields into wetland<\/a> habitats; it\u2019s also encouraging sustainable urban farming, including on rooftops.<\/p>\n Villages in the Ta Kwu Ling district will be among the first to disappear and give way to Northern Metropolis. The government wants to make the area attractive for universities. In 2028 construction is scheduled to begin on thousands of new apartments for teachers and students. In Sing Ping, a rural village in the district that\u2019s only a 20-minute walk from the mainland Chinese border, residents are worried. Emerald Lee has lived all her life in a house her parents built in the 1960s. About 50 families occupy one- or two-story homes, near fields where they grow their own food.<\/p>\n Even though the government will compensate residents, Lee says she expects it won\u2019t be enough. People living in houses such as hers can get compensation of HK$12,816 ($1,633) per square meter, one-tenth of the area\u2019s average asking price. If their incomes are low enough, they\u2019re eligible to move into subsidized government housing. Lee would rather the government relocate the village to land nearby. \u201cWe have lived here for six, seven decades,\u201d she says. \u201cWhy do they have to force us out and replace us with a bunch of very different things?\u201d<\/p>\n