September saw signs of a strong recovery in the Greater Bay Area’s real estate market, as developers bought 39 new land parcels worth RMB 38.7 billion, nearly a 50% jump over August.
Leading the way was the “Guangfo” megalopolis of Guangzhou and Foshan, with 16 plots sold in total by the two adjoining municipalities, which between them have a population of more than 20 million. Shenzhen and Zhongshan, where available land supply is scarce, both sold only one plot. Zhuhai has more available land, but sold only one plot as well. Dongguan saw probably the hottest competition, as one popular plot generated 91 rounds of bids.
The plots will yield a saleable area of over 2.13 million sqm, up from 1.37 million sqm in August, and were worth RMB 38.7 billion, up 46.6% from RMB 26.45 billion.
Among the leading developers, Vanke, Jinmao, Jindi, Poly, Agile, Oct, Hejing Futai, and China Resources were active as usual, but they were often teamed up rather than going alone. Most prominent were Vanke & Zhongtian, Jialin Group & Zhongnan Property Holdings, Hongyu Group & Junming Group.
Here is a breakdown, courtesy of local real-estate promoter leju.com, for the nine GBA cities inside Guangdong.
In late September, the sale of the Liwan plot caused a surge in the city’s total, but this was somewhat offset by a pullback in residential sales in Huadu, while commercial property generally was cooler.
Public trading data center statistics show commercial and residential land was transferred totaling 255,600 sqm, with total sales of RMB 11.12 billion, up 66.7% ove August. Seven plots were sold, three more than in August.
September was another strong month for Foshan, which had also seen positive sentiment from developers in August. Nine plots of commercial and residential land, yielding 795,000 sqm, were five times August’s total, with sales of RMB 10.7 billion rising 311.5%.
Shenzhen: One is enough
This was the city’s first land sale since June, and on September 12, China Resources paid RMB 4.66 billion yuan for the commercial plot in the central area of Houhai, Nanshan, next to Shenzhen Bay Talents Park in the south and near the coastal city in the north. Both the landscape and transportation facilities are “quite superior”, Leju analysts believe.
Five pieces of commercial and residential land were snapped up by one developer, Zhaoqing Rui Century Tourism Development Company, which paid RMB 980 million for them, 165% up over August’s total land sales. They were located in Gaoyao district, which is part of Zhaoqing’s established urban center.
Two other plots went to Zhaoqing Hecheng and Zhaoqing Liancheng, both owned by Zhaoqing Zhonghui Investment Development Company, for more than RMB 930 million.
Huizhou: “Small and fine”
Five small plots, yielding 79,500 sqm, went for RMB 1.053 billion.
Noteworthy was Vanke cooperating with Zhongtian on 40,000 sqm of commercial land in Jinyuan worth RMB 640 million. Local developer Longsheng spent RMB 295 million buying a prime commercial and residential site of more than 100,000 sqm in Zhongkai, where the tech zone is located.
Dongguan: Hot Songshan!
Dongguan sold the GBA’s third-highest land yield in September, with RMB 5.61 billion of residential and commercial transactions. Songshan Lake district was the hotspot (Huawei has its Ox Horn R&D campus here), with nine developers competing for a 50,000 sqm plot. After four and a half hours and 91 rounds of fierce auction, Shenye won it with a bid of RMB 2.325 billion, or RMB 18,599 per sqm, with a premium of 23.99%. After adding the construction cost, the effective price was RMB 28,307 yuan per sqm, making it Dongguan’s second most-valuable plot.
Jiangmen: Relatively quiet
In September, Jiangmen sold three pieces of commercial and residential land, worth just RMB 1.006 billion, down 63.5% over August. These yielded 155,000 sqm, down 55%.
Noteworthy was that the Pengjiang 15 was acquired by developer Jindi, for more than RMB 460 million, its first land purchase in Jiangmen.
Zhuhai and Zhongshan: One plot each
Zhuhai sold one plot, on the west side of Jinhu road and the south side of Tengyi road in Doumen district. It was taken by Jinmao, with RMB 2.9 billion. Zhongshan, where land supply is scarce, sold a plot in Wenhua road, Guzhen town, for RMB 640 million, to local heavyweight Agile.
Outlook for October: 43 plots coming
According to statistics from Keyland, 43 plots are expected to be transferred in the GBA’s nine cities this month, eight fewer than in September. Total transfer area is expected to be 1.825 million sqm., down 31.9% MoM, with starting bids set at RMB 45.77 billion yuan, down 12.7% MoM.