[photopress:real_estate_Huangpo.jpg,full,alignright]Suning Universal, a Shenzhen listed real estate company, has set a Shanghai land price record yesterday by buying a a 13,709 square meter plot in Huangpu District, listed for commercial and office development, for RMB4.4 billion ($578.9 million.) Based on the project’s gross floor area, the price works out to nearly RMB67,000 per square meter, which is almost double market estimates of around RMB30,000.
Remy Chan, national director at Jones Lang LaSalle, said, ‘The final price for the land plot, even taking its prime location into account, surprised me. However, the winner, compared with the other bidders, boasts superior retail experience in the local market and that could help explain its strong confidence in the project.’
The winning bid is from Suning which is an example of fraternal enterprise. According to Sun Weiming, president of Suning Universal and Suning Appliance, the country’s second-biggest home appliance chain, these are two independent companies whose chairmen are brothers.
Colliers International, another leading international property services provider, said the surprising outcome reflects the strong demand for office space in general as well as the scarcity of premier quality office/retail sites in the downtown Puxi area.
The city’s top-grade office buildings such as Plaza 66 in Jing’an District and Raffles City in Huangpu fetch net effective average rents of around US$1.30 per square meter per day. And due to limited supply in downtown Puxi in the coming years, rents for premium office developments in prime locations such as Huangpu District are expected to rise by 20% annually.
Source: Shanghai Daily