A three-party consortium placed a 13.8 billion-yuan bid to secure 19 land plots in Shanghai's Pudong district for the planned development of a new financial district in the Chinese city, the South China Morning Post reported.
The state-owned consortium comprising Shanghai Land Group Co. Ltd., Shanghai Shentong Metro Group Co. Ltd. and Pudong Railway offered to pay 10,000 yuan per square meter for the land parcels, which span a total area of 254,300 square meters and have a yield capacity of 1.37 million square meters of gross floor area.
A government filing cited by the publication disclosed that the land plots are intended to be transformed into a business zone housing offices, shops and cultural spaces. The wider development area could turn out to provide more than triple the area covered by Hong Kong's famed International Finance Centre, according to the Feb. 14 report.
Industry experts cited by the publication predict that the consortium will invest at least 50 billion yuan over the next five years in the planned development.
Vincent Cheung, deputy managing director for Asia valuations and advisory services at Colliers International, said the consortium could receive local government support by way of tax incentives to help the project attract big tenants like accounting firms and financial enterprises.
Meanwhile, Daniel Yao, head of research for East China at JLL, believes that the development between the Lujiazui financial district and Zhangjiang High Technology Park, with the potential to be a new central business district, could yield prime grade A office spaces.
As of Feb. 14, US$1 was equivalent to 6.34 yuan.