Chongqing Real Estate: Residential Stable, Office Down, Retail Up

Stephen Chung

Managing Director

Zeppelin Real Estate Analysis Limited

October 2006

(Based on Data from the China Real Estate Index System CREIS)

Chongqing is one of the major metropolitans in the western region of China and its SMSA inhabitants number some 32,000,000 according to www.wikipedia.org. GDP per capita approximates US$1,000 and it is within the development radar of the central government in its drive to modernize the western region. It is expected to receive substantial support in infrastructural improvements and is also expected to contribute much to the opening of the west. Hence, we have recently looked at some real estate data and statistics on the Chongqing real estate market and here are a few preliminary observations:

A)     Real estate indexes: these comprise the residential, office, and retail sectors. Very briefly, the overall real estate market has been growing or rising gradually with residential being relatively stable, office dropping off, and retail gaining momentum.

 

Time

Composite

Residential

Office

Retail

2005:05:00

856

610

1154

2632

2005:06:00

882

612

1155

2645

2005:07:00

895

608

1155

2658

2005:08:00

875

593

1121

2623

2005:09:00

866

592

1076

2603

2005:10:00

889

789

1059

2593

2005:11:00

892

634

1058

2574

2005:12:00

896

637

1060

2591

2006:01:00

897

639

1053

2598

2006:02:00

892

631

1049

2614

2006:03:00

917

604

867

3343

2006:04:00

1040

607

846

4572

2006:05:00

997

580

761

4478

2006:06:00

977

616

768

3995

2006:07:00

947

619

780

3657

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B)     Residential during the first half of 2006 = 1) real estate $ invested amounts to 13,800,000,000 Yuan, increasing by 25% over the same period last year; 2) some 9,970,000 m2 of construction are commenced; increasing 18% over the same period last year; 3) total construction in progress thus amounts to almost 50,000,000 m2; representing an increase of 22% over the same period last year; 4) completed construction stands at 4,314,000 m2, down around 9% from the same period last year; 5) 7,338,700 m2 are sold; and 6) sales total 15,668,000,000 Yuan [averaging 2,135 Yuan / m2].

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C)    Office during the first half of 2006 = 1) real estate $ invested amounts to 540,000,000 Yuan, decreasing by 21% over the same period last year; 2) some 244,000 m2 of construction are commenced; increasing 37% over the same period last year; 3) total construction in progress thus amounts to almost 1,888,000 m2; 4) completed construction stands at 87,000 m2; 5) 108,400 m2 are sold; and 6) sales total 473,000,000 Yuan [averaging 4,363 Yuan / m2].

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D)    Retail during the first half of 2006 = 1) real estate $ invested amounts to 2,590,000,000 Yuan, decreasing by 7% over the same period last year; 2) some 108,800 m2 of construction are commenced; increasing 2% over the same period last year; 3) total construction in progress thus amounts to almost 9,688,000 m2; reflecting an increase of 10% over the same period last year; 4) completed construction stands at 895,000 m2; 5) 549,700 m2 are sold; and 6) sales total 2,573,000,000 Yuan [averaging 4,681 Yuan / m2].

Naturally, the above figures are averages and individual projects and properties may harbor prices and rates quite different from such averages, which are meant to offer an overall feel for the market level and to be used as benchmarks.

Notes: The article and/or content contained herein are for general reference only and are not meant to substitute for proper professional advice and/or due diligence. The author(s) and Zeppelin, including its staff, associates, consultants, executives and the like do not accept any responsibility or liability for losses, damages, claims and the like arising out of the use or reference to the content contained herein.                   

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