It’s hard to believe that it’s been nearly eight months since we first opened Wheelock Square. This 270-meter office tower, the highest building in Puxi, has been attracting large-sized office suppliers with an average take-up of about 1,500 square meters per tenant. What we’ve seen in recent months shows strong momentum in the Shanghai office market – that multinational companies are resuming their expansion plans after a two-year hiatus. I’m confident this will continue in the next 12 months.
We’ve signed a number of new commitments at Wheelock Square since launching the building’s second phase – floors 36 to 61 of the tower – in January. An architectural firm is taking three whole floors, an Australian company has committed to two whole floors and a Singaporean developer has signed for half a floor. This means we’ve committed about five to six floors already. It’s an exciting response and a sign that there is rising demand for larger, higher-quality office space.
It’s always great to receive positive feedback. One bit of happy news from Wheelock Square this month came from one of our tenants, who presented us with a gold plaque as recognition of our excellent property management services. We do not try to run Wheelock Square like other commercial buildings. Actually, we try to manage it more like a hotel: Our reception staff are called “concierge” and we hire people with experience in the hotel and hospitality industry. I think the extra care and effort goes a long way in people’s work days.
Compared to the Hong Kong commercial property environment, Shanghai can be rather complicated. In Hong Kong, once you’re given the completion certificate from the government, a property is ready for occupancy. But in Shanghai, you have to obtain various licenses and permits – which are all separate from one another – before you can begin operations. Since launching Wheelock Square in May, we are still waiting for some of the necessary property title deeds – even though we’ve done all the proper inspections and survey reports. One of the problems is that you have to wait for some licenses before you can get others. We can’t apply for a car park license, for example, if we don’t have certain title deeds. It’s a lengthy process and one of my biggest challenges here.
Overall, the Chinese economy is still very promising. Government property measures that have been introduced in recent months have targeted the residential sector, and so I believe the impact on the commercial market is not substantial. Wharf is aggressive in terms of land acquisition and full of confidence for China. The group just purchased a plot of commercial land in Changsha, Hunan province for RMB5.6 billion (US$850 million). The plan is to develop a mixed-use complex, similar to Harbour City, a popular complex in Hong Kong which many mainlanders visit for shopping.
Speaking of the differences between Hong Kong and Shanghai – two cities which I travel back and forth between quite often – I am happy that I can enjoy the best of both worlds. In the winter months, I can retreat to Hong Kong’s warmer weather. And while managing properties in Shanghai, I have the opportunity to continue learning and working in mainland China’s exciting business environment.