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China Property Market – an overview of the Major Cities. Margaret Brooke, FRICS CEO, Professional Property Services. What is China?. Population of 1.3 billion 150 or more cities of over 1 million people Rapid GDP growth and demographic changes over last two decades
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China Property Market – an overview of the Major Cities Margaret Brooke, FRICS CEO, Professional Property Services
What is China? • Population of 1.3 billion • 150 or more cities of over 1 million people • Rapid GDP growth and demographic changes over last two decades • Accounts for 4-5% of world trade • Largest recipient of FDI – US$53.5 billion in 2003 • Low cost base, growing services sector
What drives China’s development? • FDI • WTO Membership • Manufacturing and exports • Property development • Auto industry • Technology development • Power and steel
50% of the world’s cement ! Construction Boom!
Controlling Demand for Property Development • Controls on lending to real estate sector following signs of bubble developing • Incentives to developers of mass market residential properties • Land use rights disposal by auction • Selected planning/investment controls • Massive infrastructure spending – subject to reviews to prevent overheating
Beijing - Key Drivers • Administrative capital • Science and technology centre • Centre of higher education • Culture/tourism • Olympics 2008
Shanghai and the Yangtze River Delta - Key Drivers • Financial and Commercial Centre • Proactive City Governance • Pudong Development Zone • City Branding • Tourism • World Expo 2010
Pearl River Delta – Key drivers • Guangzhou and Shenzhen major centres • Manufacturing and trade centre • Recipient of highest levels of manufacturing FDI • Excellent external and export links • SEZ and SAR advantages • Tourist attractions
TEDA Industrial Park • Founded in 1984 • 33 sq.km. • By June 2003, 3651 from 69 countries registered • 15% return on industrial capital achieved • Fortune 500 tenants
Suzhou Industrial Park Land Purchase Price: US$ 20/sqm Factory Purchase Price: US$365/sqm Factory Rental Price: RMB 0.60/sqm/day
Sustainability • Government is conscious of sustainability issues and attempting to curb inter-city competition and encourage more integrated planning and development • China is a signatory to Agenda 21 and has strong environmental regulations – strong implementation is the problem • Difficult to achieve highest standards when so much needs to be done in central and western provinces
Thank you for your interest