Category Archives: Real Estate

Shenzhen property stays cool

Shenzhen’e real estate market continued to stabilize in August, with the sales price of new homes rising 0.2% while the secondary market saw a slight dip, down 0.2%. 

Quarter-on-quarter, prices in the secondary market rose 2.3% QoQ, and they remain the highest in Guangdong at RMB 68,433 per sqm.

Analysts said it was clear that cooling measures put in place earlier this year were continuing to be felt. Huang, Lichong of Synergy Solution Management, said he expected prices will be stable or even slightly down in the near term.

Yuejin Yan, the CRO of E-house Research Institute, said that downward pressures remained strong, as Shenzhen needs to control the widening wealth gap and build more social housing.

Qianhai’s office rent seen catching up fast

Qianhai has a lot of yet-to-be leased office space on the market, with vacancy rates at historic highs for a district in Shenzhen. Never mind, says international real estate consultancy Colliers, it will catch up fast and likely overtake the neighboring Houhai district.  

Thanks to policy support for the special economic zone, which is attracting a surge of investment, Colliers believes Qianhai will benefit from near-term and longer-term trends in the coming years. (Read our primer on Qianhai to understand more.) Subsidies are currently generous, making rents here less than 70% of what they are in other districts, while infrastructure is being put in place that will soon make the district easier to access from the rest of the city.   Continue reading Qianhai’s office rent seen catching up fast

Report bullish on commercial property

The Greater Bay Area’s long-running boom in commercial real estate is set to continue and expand beyond the main hubs of Shenzhen and Guangzhou, according to a latest report by international consultancy JLL.

This is despite a surge in supply coming onto the market, especially in Shenzhen, where the Grade A office market is expected to almost double, from around 7 million sqm this year to 14 million sqm over the next five years, according to JLL.

The bulk of cross-border real estate investments in the region to date have largely been restricted to Hong Kong, Guangzhou and Shenzhen. These three attracted 85% percent of the total since 2009, JLL says. However, the maturing of investments into the region’s transportation infrastructure will spread this flow to a wider catchment area going forward.

Evergrande boosts talent housing

Evergrande Group, China’s largest developer, has won two residential plots at a government auction in Guangzhou for a total of RMB5.7 billion. The two parcels are less than one kilometer from the industrial site Evergrande acquired in April to build its base for new energy vehicles.

Covering an area of 51,000 square meters, the two parcels are located inside Guangzhou Nansha’s Bonded Port, which is planned for the development of a comprehensive service sector and advanced manufacturing.

Evergrande is required by the local government to build talent apartments on the plots, including a 30-class primary school and a 18-class kindergarten. Upon their completion, the talent apartments will be resold to the organization units designated by Nanshan Development Zone Administrative Committee at the price of RMB3500 per square meter.

Housing in big cities stays cool

It’s been a blistering summer so far, but housing prices in the Greater Bay Area’s three biggest cities have been cool. In Hong Kong, there are no points for guessing why recent home sales have seen developers cut prices, while even the secondary markethas seen weakness, and the outlook appears bleak. Guangzhou and Shenzhen, meanwhile, are treading water as the central government has maintained its stance that “housing is for living not for speculation”. 

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GBA property markets cool, not fast enough

Despite a contraction in bank lending to Guangdong’s real-estate market in Q2, property volumes and prices throughout the key GBA cities showed strength in the first half of the year as developers turned to alternative funding channels, latest provincial data shows. 

According to the latest report by the provincial housing bureau, GBA cities diverged from the rest of the province between the first and second quarters. This was primarily due to the cost of capital. The eastern, western and northern regions of the province saw a rise in volumes but prices fell, while the nine cities of the GBA saw a rise in both volumes and prices.

Guangdong sold a total of 63.218 million sqm in property during the first half, down 3.7% year-on-year. Total contracted sales, however, were RMB888.76 billion, up 6.6% year-on-year.

Continue reading GBA property markets cool, not fast enough

Shenzhen is costly, yet upside looks good

The research arm of China’s leading open-platform real estate listings portal, Beike, recently released its latest index on the growth potential of property markets across the country. Shenzhen was ranked No. 1, for two main reasons: 1) a relatively low homeownership rate; and 2) an “open attitude towards newcomers”.

The list ranks China’s top 100 cities based on a range of indicators, including policy trends, industrial clustering, urbanization growth and achievement, population flows and GDP per capita. 

Shenzhen was followed by Beijing and Shanghai. Guangzhou fell into fifth place behind Hangzhou, followed by Suzhou, Nanjing, Wuhan, Xiamen, and Tianjin in Top 10. 

The rest of the GBA cities made it, too. Zhuhai was ranked 22nd, Dongguan 27th, Foshan 32nd, Huizhou 33rd, Zhongshan 34th, Jiangmen 68th, and Zhaoqing 93rd.

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Macau sees property sales plunge in first half

Something strange is happening in Macau’s property market. After a rapid expansion period in 2017 and a cooling off last year, residential sales, which usually follow gaming revenue trends, saw a sharp fall in the first half of this year. Transactions plunged 42.2% YoY, according to DSF statistics. Offices did slightly better, but retail space also took a knock. This is despite the influx of visitors, which were up nearly 25%, and the stabilization of gaming revenues, which were slightly positive.

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Shenzhen’s first Wanda Plaza

Dalian Wanda, headed by billionaire Wang Jianlin, has acquired the right to lease and manage a commercial plaza in Shenzhen, marking its first foray into the city. Located at the intersection of Guangming Avenue and Guanguang Road in the eastern Guangming District, Yuefu Square has a gross floor area of 375,1000 sqm and comprises two office towers, two residential towers and a five-floor retail podium. 

Although Wanda has already built a presence in Guangzhou, Dongguan, Foshan, Jiangmen and Zhaoqing, it has so far not managed to obtain a spot in Shenzhen. This has been largely due to scarcity of land. Wanda’s development model of acquiring low-priced land for large scale development doesn’t fit with Shenzhen’s reality. 

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Shenzhen steps up cooling measures

As new data shows slowing growth in housing prices across the country in June, cities are responding to central government directives with different administrative measures to curb overheated markets. Shenzhen has chosen to tighten up on the flow of data and has sent teams around to individual new-home projects to personally encourage restraint by developers.

Average new home prices in China’s 70 major cities grew 0.6% in June from a month earlier, easing from a 0.7% gain in May, according to Reuters calculations based on data from the National Bureau of Statistics. Sixty-three of the total 70 cities surveyed by the NBS saw average home prices rise in June, down from the 67 that reported price increases in May. 

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