Where did the Hong Kong Observation Wheel deal go wrong? The existing operator Swiss AEX proposed to operate an observation wheel at HK$100/ride and was willing to pay HK$800K/month in rent. He assumed to earn money from the wheel only. The winner, Michael Denmark, will charge HK$20/ride and is willing to pay HK$1.5M/month. How can it be that cheap? How does he expect to make money? Simple. He plans to earn money from events, advertising and linking visitors with a large insurance company, not from the wheel. (新營辦商希望透過舉辦活動及廣告等，擴闊收入來源)
The two bids are so different because the tender allows this. Worse, the Government publicly announced that it will allow the site to be used, even before there is a wheel in service. In fact, there is little financial penalty in case the wheel is never built. (政府容許新營辦商亦可以在沒有摩天輪的用地上，提供輔助設施或舉辦活動)
Is all of this legal? It all depends on the definition of the word ‘ancillary facilities’ (輔助設施). Ancillary means ‘providing necessary support to the primary activities or operation.’ So, it would be very strange that the site can open without a wheel!
Is all this fair? Can MTRC open shops before opening the railway? Can food trucks sell kitchenware without selling food? (美食車可以售賣廚具而不售賣食物嗎？) In their enthusiasm to make the harbourfront a better place, and restricted by short term tenancy agreements, the Harbour Unit at the Development Bureau may have caused confusion. What we have learned is that we urgently need a Harbourfront Authority (海濱管理局) to avoid this in the future.