Sub-lease Chengfeng Industrial Village in violation of regulations should not be a profit-making tool

01 point of view

Written by: Review Editor Room

2020-07-07 16:00

The rapid development of emerging industries, such as cloud computing and the rise of big data, has led to a huge increase in the global stock of big data, which has contributed to the market's demand for data centers. In the past, the Hong Kong Government had policies to support the local development of data centers. For example, if the industrial village land was leased at a discounted price, only companies rented the land to develop data centers at low prices, and then leased them to other small and medium-sized enterprises to earn considerable profits. The land in industrial villages is subsidized by public funds. The practice of subletting is no different from that of government subsidized enterprises. The government cannot ignore relevant issues.

In recent years, the Hong Kong Government has actively developed Hong Kong as a "data center hub in Asia". As the statutory body that manages the government’s three industrial villages and multiple research sites, the Hong Kong Science and Technology Park Corporation has been providing data center sites in industrial villages. So far, there are 12 data centers in Tai Po and Tseung Kwan O Industrial Villages, covering more than 356,000 meters. . It stands to reason that the Science and Technology Park stipulates that the relevant plant can only carry out other operations that have been approved or approved in writing, and cannot be sub-leased to other people.

However, the practice of large companies sub-leasing industrial village data centers has become common practice. For example, HKCOLO (Hong Kong Neutral Machine Building Co., Ltd.) was revealed to be a 30% discount to obtain sub-leased factory premises in Tseung Kwan O Industrial Estate. The Science and Technology Park condones tenants in Tseung Kwan O Industrial Village illegally subletting to third parties for profit. The operators involved only leased lots at a few hundred dollars per foot, but leased cabinets to multinational companies and even government departments at market prices. Recently, it was reported in the newspapers that there was a "double sublease" of the land in the Tai Po Industrial Village. The operator in question, Asia Satellite, suspected that the land of the science and technology park should be subleased to HGC (Global Telecommunications Co., Ltd.), which then divided the site into a data center. rent.

Ren Jingxin, chief executive officer of SuneVision, which operates the data center, said that the Science and Technology Park granted preferential industrial village land to the data center, but there was no regulatory violation of subletting after that, which was extremely unfair to other data center competitors. (Photo by Liang Pengwei)

Speculators should not be funded for profit

Admittedly, there is a gray area in the sublet. In the above judicial review, the court sentenced Xinyiwang to lose the case, because the judge believed that the operator involved was only to provide services to the customer, and the latter did not actually have the exclusive right to occupy, so the relationship between the two was not considered a "sublet" relationship. . However, Xinyinet believes that the High Court’s ruling has a legal error and is currently appealing.

However, it should not be overlooked that the industrial village was heavily funded by public funds, originally intended to fund the development of data centers. The government and the Science Park should ensure that the relevant land is used only for relevant purposes, not for opportunists to sub-lease for profit, otherwise It is no different than transferring benefits to the sublet. However, the science and technology park company obviously failed to fulfill its responsibilities. Instead, it defended tenants many times, which violated the ethics of its management of industrial villages, and even taught people to suspect that the science and technology park was forgotten by the considerable rental income. In order to ensure the correct use of industrial villages, and even the public funds themselves. Regardless of the outcome of the appeal, the government should also take the initiative to intervene in the incident to ensure that the loopholes in subletting are blocked.

However, the fundamental reason is that the sub-lease of land in industrial villages is not unrelated to the operating cost of data centers. Always, only large groups with certain financial resources can afford the high cost of buying land and constructing data centers. On the contrary, many smaller data centers can only rent large enterprise facilities due to lack of financial resources. Even though the government has encouraged small operators to use industrial buildings to set up data centers in recent years, the cost of retrofitting is equally expensive, so it creates “business opportunities” for large enterprises to sublease, and dare to rent cheaper technology park land to build data centers, and then sublease some space for Small and medium-sized data center operators.

From this point of view, the crux of the problem lies in the limited supply of land available for data center development. In the long run, if the government wants to catch up with Singapore as an "Asian data center hub", it must increase land for data center development, especially to increase the space that SME operators can afford. However, in the short supply of land, to meet the needs of small and medium-sized operators in the short term, the government and the science and technology park may need to consider building sub-lease of data center facilities to provide small and medium-sized operators with a reasonable amount of space that can be afforded outside the market. As for the use of industrial building space advocated by the government, due to the certain space conditions required by the data center, not all industrial buildings can be converted. The government should study the needs of the industry and the environmental conditions of existing industrial buildings, and whether it can improve the industrial building space conversion Feasibility.

[New Coronary Pneumonia] The problem of mask production is not tendering but lack of transparency

It is rumored that government funding must be used to improve public funds for lifts in Hong Kong

01 depth

Big data cloud storage re-industrialization 01 point of view