The West Kowloon Cultural District has run deeper into the red over the past financial year in part because of lower income and rising costs.

In documents submitted to the legislature on Thursday, the district's authority said its operating deficit rose by a third year on year to nearly HK$770 million.

It also suffered an 18-percent drop in underlying income to HK$871 million.

Admissions and ticketing income decreased by nearly 24 percent to HK$144 million while fundraising fell to HK$167 million, or by 30 percent.

Staff costs, meanwhile, rose by more than 27 percent to HK$571 million.

Speaking on Metro Radio, the vice chairman of the authority's board, Bernard Chan, said it takes time for the cultural and arts hub to be financially supported by property developments within the district.

He stressed that the idea to follow the MTR Corporation model in terms of financing the art hub's operations was always the one and only way of how the district would work.

"From day one, the financial model of the district is to use financial activities to subsidise the art facilities," he said.

"But it's just the time lag that the business activities aren't there yet."

Chan said no art facilities around the world are actually making a profit.

He expressed hope people would understand that arts and culture are a form of investment and that the idea is for such facilities to not go too far into the red.

Chan added that the authority is trying hard to find new sources of income, such as by renting out venues, finding sponsors, selling merchandise and storing auction items.

He went on to say Hong Kong's financial model is different from those prevalent in Europe and the United States, which mostly rely on government sponsors and private funding, respectively.

The government last year approved the sale of homes by the West Kowloon Cultural District Authority to help with its finances.