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 | Monday, April 24, 2000, updated at 09:56(GMT+8) | ||||||||||||
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Pudong's Real Estate Market Picking upHousing sales in Pudong New Area of Shanghai have been brisk this year, and 333,000 square meters of floor space was sold in January, compared with 225,000 in the same period last year, according to official statistics."If China joins WTO, all vacant houses will be sold out in five years," said Huang Qifan, deputy secretary-general of the Shanghai Municipal People's Government, and chairman of Shanghai Economic Commission. "In ten years, Pudong may need more buildings," he told Xinhua in a recent interview. The Pudong New Area Administrative Committee said there are dozens of firms and residents moving into Pudong everyday. Half of the office buildings and 40 percent of residential quarters in Pudong are vacant. Over the past decade, apartment buildings with some 29 million square meters of floor space went up in Pudong. Experts pointed out that real estate developers built too many buildings in 1992-1994. Real estate developers also overestimated the number of companies planning to invest in Pudong, despite the fact that one-fifth of the world's 500 largest companies have set up subsidiaries in the area. Puding is not without competition. The Suzhou Industrial Park, 90 kilometers away, has been competing with Pudong in luring overseas investors, with housing property prices 60 percent lower, causing real estate sales to stagnant for a period of time in Pudong. In 1995, Pudong started to curb real estate development. The news of China's expected entry into WTO has triggered off a new wave of investment from both at home and abroad. For instance, the Wanxiang Real Estate Group, based in east China's Zhejiang Province, invested US$50 million in developing luxury office buildings in the Lujiazui Financial and Trade Zone in the heart of Pudong. At percent, more than 80 percent of buildings in Lujiazui, where China is to build a Financial Center, have been sold out or leased. Prices of residential quarters are also picking up along with the improvement of infrastructure facilities. While housing prices in Shanghai are generally going down, those in Pudong are rising. In January, housing prices in Pudong went up 5.57 percent over the corresponding period last year. Real estate developer Wei Ping, head of the Tian'en Garden, said that a number of film stars and anchorpeople are purchasing houses in Pudong. As Pudong's economy develops rapidly, more and more people are moving into the area. It is predicted that population in the 522-square-kilometer area will rise from 1.5 million to 3 million in a decade. Pudong began developing on April 18, 1990 when the central government announced that China would open up and develop the area. Over the past decade, Pudong's economic growth has taken the lead in China. Gross domestic product rose from 6 billion yuan ( about US$720 million) in 1990 to 80 billion yuan (US$9.64 billion) in 1999, up 21 percent annually on average. Hua Xinxiang, an official at the Pudong New Area Administrative Committee, said that Pudong's economy will continue to develop vigorously in the next decade. "Bubble economy does not exist in Pudong as it occurred in some southeastern Asian nations," Hua said, adding that "We have strong industries here."
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