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Publicly-traded company sells Beijing school district apartments to keep afloat

By Kou Jie (People's Daily Online)    12:45, September 22, 2016

[File photo]

In an effort to preserve its listed status, an unprofitable company in China is planning to sell two apartments in an excellent Beijing school district, where skyrocketing prices have risen 13-fold in the past 12 years.

The company, *ST Ningtong B, released a sales notice for two of its properties in Beijing on Sept. 20. If the properties can be sold for a satisfactory price, the company, which has been running at a loss for two consecutive fiscal years, may finally enjoy some gains. In addition, the enterprise will be able to maintain control over its shell resources, Securities Daily reported on Sept. 21.

According to the report, the company’s two properties are located in Beijing’s Xicheng District, where the unit sales price for residential plots is above 100,000 RMB ($14,989) per square meter. Though the apartments have been valued at over 22.7 million RMB, some experts believe that the actual price may reach 28.2 million RMB. The two units were purchased for 2.1 million RMB in 2004.

“The real estate market in China is overheating," an anonymous economist told Securities Daily in an interview. "The profit created by thousands of employees in a listed company may not even surpass the price of an apartment in a first-tier city in China. If the situation cannot be dealt with, it will negatively influence the country’s economy.”

School district houses, or "xuequfang," have become a hot topic in China in the past few years, as public school enrollment in China requires a family’s residence to be registered at an address associated with the school. Imbalanced education resources and booming real estate have led to soaring prices for school district houses in big cities.

In June, a hallway measuring just 1.5 by 7 meters in a desirable Beijing school district was priced at 1.5 million RMB, the Beijing Morning Post reported.

(For the latest China news, Please follow People's Daily on Twitter and Facebook)(Web editor: Kou Jie, Bianji)

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