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Hong Kong launches $4bn stadium PPP

The city hopes to attract bidders with a compensation scheme for unsuccessful proposals.

Hong Kong's Home Affairs Bureau is inviting pre-qualification submissions for the HK$31.9 billion ($4.1 billion; €3.75 billion) contract for the Kai Tai Sports Park, set to be the city’s largest sports complex.

The concessionaire will design, construct and operate the Kai Tak Sports Park for 25 years, during which time the operator will be required to share its operating income with the government. In order to attract bids, the government is proposing a bid incentive for unsuccessful bidders, offering HK$60 million or 50 percent of the actual cost incurred in the preparation of the bid – whichever is lower – to each unsuccessful bidder who has submitted a conforming bid. They must, however, agree to give up the intellectual property rights to their documents.  

The deadline for pre-qualification submission is set for 30 June. The government aims to complete the tender process this year in order to kick-start construction next year, with completion expected in 2022-2023.

Kai Tai Sports Park includes a multi-purpose main stadium with a capacity of around 50,000, a public sports ground for 5,000 people, an indoor sports centre with a multi-purpose main arena of 10,000 seats, and an ancillary sports hall with a seating capacity of 500, among other features.

It is one of the few projects in Hong Kong to be delivered under a design-build-operate model, with the majority of projects, including the landmark Hong Kong-Zhuhai-Macau Bridge, procured under a design-build framework, with the operations outsourced in a separate process.   

The government estimated that the successful bidder could break even in as little as three years, with a projected annual net profit of HK$276 million, a local report said, quoting commissioner for sports Yeung Tak-keung.
Applicants for the project are expected to be or form teams with first-tier sub-contractors and operations team leaders for stadiums.