The government says the estimated cost of building artificial islands off Lantau has increased to HK$580 billion, up from the HK$500 billion predicted in 2018, with three islands to be built.

According to a paper submitted to the Legislative Council on Tuesday, the islands will be built with a Y-shape water channel running between them, and they will be kept away from the surrounding natural islands by water channels to avoid impact on coral of ecological value.

Authorities said they hope establish a core business district on the islands to help enhance the SAR’s overall competitiveness.

The government is also planning to build seven “liveable living communities” of around 80 to 100 hectares each connected by a green mass transit system, so residents can reach various destinations from home within 15 minutes to buy daily necessities.

There will be more open space as well as community and social welfare facilities as part of the sustainable, accessible and people-oriented communities, the paper noted.

The government added that land sale revenue from private residential and commercial sites within the Kau Yi Chau Artificial Islands project will be about HK$750 billion, based on conservative assumptions.

“In other words, with the consideration of the latest market condition together with conservative assumptions, the land sale revenue is still higher than the construction cost. In fact, apart from the land sale revenue, investment on infrastructure works can also drive economic growth,” the paper says.

The paper also says authorities will not rely solely on public money to fund the project, but will explore options including bond issuance, and different modes of public-private participation such as the “build-operate-transfer” model for roads and a “railway-plus-property” model for railways.

The project, previously referred to as Lantau Tomorrow Vision by former chief executive Carrie Lam, is expected to provide 190,000 to 210,000 residential flats – 70 percent of which will be public housing.

The government said the first batch of residents will be able to move in in 2033, at the earliest.

In the original blueprint, authorities had wanted to construct a railway to link north Lantau to the coastal area of Tuen Mun.

But according to the latest proposal, authorities are now planning to connect the strategic rail link to Hung Shui Kiu instead – where it will then link to the Hong Kong-Shenzhen Western Railway.

The rail link will also run through Hong Kong Island west and will be connected to the existing MTR network.

The paper states that the project is still at the preliminary planning stage, with an environmental impact assessment and ground investigation being conducted.

“Not until the overall design work is completed will we have the basis to develop the phased implementation of works and provide a cost estimate with reference to a more detailed engineering design,” it says.

The paper is scheduled to be discussed by the Legislative Council’s development panel next Thursday.