Hong Kong's Race to Rule: Who Will Deliver Space First?

By Michael Hart -- Tradeshow Week, 11/22/2004

For years, the story about the Chinese trade fair industry passed around most frequently in the United States has been the rapid pace of exhibition space construction in mainland cities. But in recent months, the focus has shifted to Hong Kong.

Certainly, since the Hong Kong Convention and Exhibition Centre was built in 1988, it has been the heart and soul of that city's exhibition business. But even with its current 64,000 square meters (688,000 square feet), at some of its shows — like the Hong Kong Gifts & Premium Fair or the Hong Kong Intl. Toys & Gifts Show — exhibitors routinely are left on waiting lists because space is not available.

It's no secret that in a year HKCEC will be joined by AsiaWorld-Expo, a venue with 70,000 sq. m. (753,000 sq. ft.) located a 23-minute train trip away at the Hong Kong Intl. Airport.

"At the moment, everything's confidential as far as our calendar is concerned," said AsiaWorld-Expo Deputy CEO Allen Ha.

But the venue has announced at least 13 exhibitions for 2006, including ITU TELECOM WORLD, which will be held outside of Geneva for the first time since its inception in 1971.

As to whether he plans to woo some of HKCEC's current space-hungry customers or seek out new business, perhaps from the nearby booming Pearl River Delta region, Ha said, "We do a bit of both. There is a degree of competition, but the market is huge."

Cliff Wallace, managing director of the HKCEC, said the new airport venue should be developing new shows to address emerging markets. When it comes to giving up current shows to AsiaWorld-Expo, he said, "We don't intend to roll over and become charitable."

That is at least one reason why, in early September, the Hong Kong Trade Development Council announced a proposal to expand HKCEC by 19,400 sq. m. (208,000 sq. ft.), at a cost of HK$1.2 billion (US$154 million).

Wallace said the additional space will let the center's five largest annual shows expand to 4,500 exhibitors, making the cost of the expansion worthwhile. The center has also identified other fast-growing shows, such as Asia Pacific Leather Fair.

The expansion, which would be built above an atrium linking the two elements of the current facility and creating larger "seamless" exhibit halls, could be completed by early 2009.

In the meantime, the Trade Development Council's proposal includes a request to the Chinese government to rent the Tamar site between HKCEC and the Wanchai ferry station, where 20,000 sq. m. (215,000 sq. ft.) of temporary exhibition space could be built as early as next spring and maintained until the expansion is complete. That would allow Wallace to almost immediately make available the same amount of space as the expansion, but months before AsiaWorld-Expo even opens.

TDC Executive Director Fred Lam said, "We really feel that Hong Kong cannot afford to wait."

In mid-October, the Hong Kong press began reporting that AsiaWorld-Expo was threatening to sue the Chinese government because it had promised that it would not allow the Tamar site to be used for exhibitions until the new venue experienced "stabilized levels of business."

Tradeshow Week has been unable to substantiate the unattributed report in the Hong Kong Standard. However, Wallace said, "To my knowledge, there is no lawsuit, only the speculation by some, especially in the media, that there could be one."

Ha would not confirm or deny whether AsiaWorld-Expo was considering the lawsuit, saying only, "This is just a little domestic dispute. It's more of a government policy thing."

Shying away from the controversy for the moment are operators of some of the large shows that could benefit from new space at either AsiaWorld-Expo or the HKCEC.

"It is the story that's making the news," said Peter Sutton, president and CEO of CMP Asia, "but we've deliberately stayed out of the discussion. There's nothing to be gained by getting involved in this."