PROPERTY developers China Overseas Land and Investment and China Resources jointly purchased a land plot in downtown Nanshan District for 18.5 billion yuan (US$2.5 billion).

China Overseas and China Resources bought the land at a premium rate of 46% at an auction Monday after 295 rounds of bidding. The starting price was 12.7 billion yuan.

Located next to the Dengliang Metro Station on Line 2, the land, previously planned for an office and commercial complex, is one of the few residential plots in the surrounding Houhai business area with offices from large tech companies, such as Alibaba Group Holding, Tencent and Baidu.

Notably, there are no restrictions from the local government concerning apartment sizes or prices within the forthcoming housing estate to be built on the site. It is expected that apartments on the plot could cost over 133,000 yuan per square meter.

Shenzhen’s planned residential land supply for 2024 stands at 180 hectares, with 80 hectares allocated for commercial housing and 100 hectares for subsidized housing, as per the city’s Urban Planning and Natural Resources Bureau. The land supply for commercial housing has decreased by 61% compared to the previous year.

Nonetheless, the local real estate market has been recovering since the end of September thanks to a series of supportive policies. Last month, nearly 8,080 contracts for new homes were signed in the city, up 95% from October, according to data from the Leyoujia Research Center, while 7,125 contracts for pre-owned homes were signed, up 17% to the highest in nearly four years.

The average transaction price of pre-owned apartments in Shenzhen rose 2.1% in November from the previous month, reaching 64,300 yuan per square meter, as per data from the Leyoujia Research Center.

In the past two years, China Overseas has purchased many land plots at high prices in the country’s four first-tier cities. Its sales in Beijing, Guangzhou, Shanghai, and Shenzhen totaled 74.4 billion yuan in the first six months of this year, accounting for over 60% of the total.

(SD News)