A study on the current institutional barriers encountered under the conversion of underused spaces into student housing

Abstract

Amid Hong Kong’s ambition to position itself as an international education hub, the rising influx of non-local students has led to an increasing demand for student housing. While adaptive reuse of underutilized space emerged as a potential solution, the conversion into student housing faces potential institutional challenges and ambiguities under Hong Kong’s current regulatory framework. In response to the government’s aim to streamline regulatory procedures and boost market supply of student housing, this study investigates the institutional barriers encountered in converting underused properties, such as hotels, commercial buildings, and industrial premises, into student housing. Employing a qualitative approach, semi-structured interviews were conducted with stakeholders including developers, consultants, and government officers. Supplemented by desktop research, this study examines how planning regulations, lease restrictions, licensing ordinances, and the Revitalization Scheme of Industrial Buildings (RIB Scheme) create practical and legal uncertainties for such conversions. Key findings highlight regulatory ambiguities, including the lack of formal land-use classification for student housing, reliance on hotel licensing with restrictive short-term tenancy definitions, outdated lease clauses such as offensive trade clause, and legal uncertainty surrounding special waiver granted under the RIB Scheme for wholesale conversion. These barriers not only increase transaction costs but also limit investor confidence and urban planning efficiency. To address these challenges, the study recommends updating statutory definitions to formally recognise student housing under planning and licensing frameworks, and revising the RIB Scheme to better accommodate emerging use cases. Although the research is limited by the small number of interviewees due to the nascent stage of local student housing market, it established a critical foundation for future inquiry. Notably, financial feasibility is excluded from this study due to limited market data but remains an essential area for further research, particularly on affordability, rental spectrum, and investment performance compared to co-living or serviced apartments.