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Prime Land Expected to Set Market Record
Feb 24,2010 09:08CST
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Source:SMM

BEIJING, Feb. 24 -- A 49,000 sq m space of commercial land is expected to be sold for more than 10 billion yuan in early March, a record for Beijing's land market.

The slot is located in Beijing's Central Business District (CBD) at Guomao, northeast of an intersection at East Third Ring Road and Jianguo Road, with the new CCTV tower and the World Trade Center in sight. It is being dubbed as "Zhongfu land" by insiders, due to its close proximity to Beijing Zhongfu Building.

According to Beijing municipal bureau of land and resources, "Zhongfu land" will be auctioned off between Feb 22 to Mar 8. The starting bid is set at 5 billion yuan, with a required 3 billion yuan deposit to take part.

"We have a requirement on the qualifications of bidders; only a combination of real estate dealers and financial institutions are permitted to buy this land," a woman surnamed Li from Beijing Land Reserve Center told METRO yesterday.

Li said the number of property dealers and financial organizations is unlimited, but financial enterprises must account for more than 50 percent of the total project sum.

This will become the first time for Beijing authorities to establish a restriction on bidders and has aroused extensive suspicion as to whether the land had already been assigned to a specific property developer by the Beijing government.

Sino-Ocean Land, a Hong Kong listed company and a subsidiary of the State-owned COSCO group, was once targeted as the most likely purchaser because of its strong political and economic background.

It was also suggested that the restrictions had been tailored to benefit the company after China Life purchased 423 million of its stocks in January, making it the largest shareholder in Sino-Ocean Land.

Ye Xiangzhong, deputy director of Beijing Land Reserve Center, denied the allegation that "Zhongfu land" was a fixed deal.

"I did not know China Life had bought Sino-Ocean Land and it is not proper to say that the restrictions were tailored to suit them," Ye told local media earlier. "The restriction was worked out on the basis of the overall plan of Beijing CBD area."

A document posted on the website of Beijing Land Reserve Center said Beijing aims to attract banks, insurers, and securities from both home and abroad to set up offices in CBD area. Chaoyang district government hopes to see suitable financial enterprises take part in constructing "Zhongfu land".

Over 20 property developers, including industry giants such as Poly China, Vanke, SOHO China and Sino-Ocean Land, have shown interest.

"I think this is the best land in Beijing. Finding land larger than one hectare in such a busy location is very rare indeed," Qin Xiaomei, chief researcher with Jones Lang LaSalle Beijing, told METRO yesterday.

"If we have two or three bidders, I dare say the price will surpass 10 billion yuan," said Tao Hongbing, president of SYS Win Brokerage, a Chinese property agent.

 

China economy macroeconomy
real estate industry

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