Initial design of the logistics hub at Hong Kong International Airport subject to government approval. Credit: Alibaba Group Holding Limited.

A JV led by Alibaba Group’s logistics unit Cainiao Network has secured a contract from Airport Authority Hong Kong to develop and manage a $1.5bn logistics centre at Kwo Lo Wan in the South Cargo Precinct of Hong Kong International Airport (HKIA).

Other constituents of the JV are China National Aviation Corporation (Group) and YTO Express.

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Covering 5.3ha and with an estimated gross floor area of 380,000m², the centre will feature new technologies such as automated warehousing and temperature-control solutions.

Under the agreement, the JV will design, construct, finance and manage the logistics hub, which will include an air cargo processing area and a sorting centre.

Cainiao Network president Wan Lin said: “The Hong Kong hub will be yet another milestone on our way to achieving our goal of 72-hour global delivery, and will further empower SMEs locally and globally to more readily tap the benefits of more inclusive globalisation through cross-border e-commerce.

“Hong Kong International Airport has been the world’s busiest cargo airport for many years.”

“The Hong Kong International Airport has been the world’s busiest cargo airport for many years. As an important gateway for global goods to enter the mainland China market and vice versa, Hong Kong is of strategic importance to Cainiao and we have a strong commitment to help the city address the surging needs of the future.”

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Once operational in 2023, the centre will handle parcels to meet the surging cross-border e-commerce needs of global SMEs.

It will bring cargo volume of almost 1.7 million tonnes per annum to the HKIA.

The centre will be developed using advanced environmental protection standards such as BEAM Plus Gold and LEED Gold. It will also feature ramp access to all floors and allow the use of large-scale robotics and automation.