Source on the "immigrants in cages"? Tai Kok Tsui seems fairly pleasant and somewhat up-and-coming with new development in west Kowloon.

Edit:

http://www.time.com/time/world/article/0,8599,1917897,00.htm... http://www.atimes.com/atimes/China_Business/KI03Cb02.html

Basically just bunks with wire mesh to protect belongings. You'd not guess from walking around the streets.