The Home Affairs Bureau says the West Kowloon Cultural District project's arts and cultural facilities could be operated in a financially sustainable manner.

Responding to a report submitted by the specialist advisor a Legislative Council subcommittee commissioned, the bureau said the retail, dining and entertainment facilities would generate an estimated rental income of $8.4 billion over the project's first 50 years.

The figure is about 10% higher than the estimated total operating deficit of $7.6 billion for the arts and cultural facilities, it added.

Building maintenance

Provision has already been made for regular major overhauls and annual building maintenance during the 50-year project period.

All facilities will be in good condition and fully functional beyond 50 years, and there will be no question of demolishing or re-building the facilities immediately after 50 years.

The bureau said only the land for residential, office and hotel uses within the 40-hectare site would be sold. The Government would sell the land separately and the revenue would be paid into the general revenue and not used on the project.

Museum development

On the construction of Museum Plus, or M+, the bureau said the estimated construction cost is $2.6 billion. The estimated annual operating deficit is about $300 million, which is comparable to the total recurrent expenditure of about  $500 million for all Leisure & Cultural Services Department museums.

The rental income from retail, dining and entertainment facilities can fully cover the overall total operating deficit of the arts and cultural facilities, including M+.

The bureau said engaging an international operator to operate M+ will not achieve M+'s vision, and M+ would lose Hong Kong's unique cultural character and curatorial freedom.

It will also restrict M+'s future development and hinder its co-operation with internationally renowned museums on a mutually beneficial basis. This development model may also incur higher costs than expected.