GRA Market Weekly (2025-02-16)

Policy Watch

State Council executive meeting: better meeting housing consumption demand

On 10 February, a State Council executive meeting studied measures to boost consumption. The meeting noted that boosting consumption is the top priority in expanding domestic demand and strengthening the domestic economic cycle. It called for upgrading big-ticket consumption, stepping up support for consumer goods trade-in programmes, better meeting housing consumption demand, and extending the automobile consumption chain; and for strengthening consumer brand leadership, supporting the accelerated growth of new consumption formats, promoting "AI + consumption" and health consumption, and continuously creating new consumer products, scenarios and hotspots.

Shanghai to refine property policies

On 13 February, the Shanghai Development and Reform Commission announced that the city's 2025 policy package for sustaining the economic recovery had been approved. Among the livelihood measures, Shanghai will optimise and refine real estate policies and comprehensively accelerate "two-old-one-village" renovation and urban renewal: completing the renovation of scattered sub-standard old lane housing in the city centre, launching 25 urban village redevelopment projects, implementing an action plan to upgrade commercial office buildings, increasing the supply of quality residential land, and building safe, comfortable, green and smart "good homes" to promote the stable and healthy development of the property market.

Market Watch

Hangzhou: three residential plots fetch RMB 1.53 bn, top premium 65.11%

On 14 February, three residential-use plots were offered in Hangzhou, with a total site area of 84,403 sqm, total planned GFA of 96,918.55 sqm and a combined starting price of c. RMB 1.23 bn. Two plots sold at premiums and one at reserve price, for total proceeds of RMB 1.53 bn. The Heyu Road plot in Linping District went to Hulunbuir Huijia Real Estate Development after 35 rounds of bidding for RMB 431 m, at a floor price of RMB 15,686/sqm and a 65.11% premium.

Poly Developments and China Jinmao take Beijing's Sanjianfang combined plot in Chaoyang for RMB 8.7295 bn

On 11 February, Beijing successfully sold a residential-use combined plot in Chaoyang District. Three bidders - the Poly Developments & China Jinmao consortium, China Overseas, and China Merchants Shekou - competed over more than a hundred rounds before Poly & Jinmao prevailed at RMB 8.7295 bn, a floor price of RMB 50,478/sqm (RMB 51,732/sqm excluding the mandated build-out area) and a 10.50% premium.

China Overseas wins Zhengzhou's new Jinshui District land king at an 87% premium

On 8 February, at Zhengzhou's first auction of 2025, the Judicial Police Academy plot in Jinshui District sold after six hours of bidding at an 87.48% premium and a floor price of RMB 13,713/sqm, breaking the RMB 13,411/sqm record set by Vanke's Zhengfangji plot - the highest-premium residential-use plot in Zhengzhou since 2021.

Project Watch

Lujiazui Group's first affordable rental housing project debuts in Shanghai

On 12 February, the "Digital Wisdom World Rental Community", a government-supported rental community within Zhangjiang Science City, Shanghai, welcomed its first tenants. The 1,200 rental units released include a corporate apartment block serving as a "home for new-era city builders and managers", offering enterprises staff dormitory space with more than 1,000 beds.

The community is the first affordable rental project of Lujiazui Leju, Lujiazui Group's rental residential brand. Located beside the Middle Ring at Yuqiao, Pudong, it is a metro-linked TOD development. Unit types span c. 31-37 sqm and 61-64 sqm one-bedroom units, c. 57-68 sqm one-bedroom-plus-living-room units, and c. 35-40 sqm corporate four-person dormitories, catering to different tenant groups.

Shanghai Chenghuangmiao Plaza sells at judicial auction for RMB 1.209 bn

On 14 February, Alibaba's asset auction platform showed that the auction for restructuring-investor qualification of Shanghai Chenghuangmiao Plaza Properties Co., Ltd. had concluded at RMB 1.209 bn. The property comprises 36,100 sqm of GFA over two basement levels and one floor above ground. Located at 168 Fangbang Middle Road and adjacent addresses in Huangpu District, it sits south of Yu Garden, with the Fosun-Ant plot - newly named "Yu Bund" - to its east.

Qingdao Shimao 52+ mall taken over by a local SOE

The Shimao 52+ shopping centre on Baoyuan Road in the Chengyang high-tech zone recently reached the final day of its second auction, with the reserve price lowered to RMB 302.83 m. Only one bidder registered and took the mall at the reserve price: Qingdao Hongtou Urban Operation Management Co., Ltd., a wholly owned subsidiary of Qingdao Hongtou Holdings Group and a local SOE in Chengyang District. Qingdao Shimao 52+, at the junction of Baoyuan Road and Fengshou Road, has total GFA of 65,000 sqm over two basement and four above-ground floors, housing a premium supermarket, fashion brands, a children's playland, and dining and entertainment.

Corporate Watch

Three national AMCs consolidated under Central Huijin

On 14 February, China Cinda, China Great Wall and China Orient each announced that controlling shareholder the Ministry of Finance intends to transfer, without consideration, its entire shareholdings to Central Huijin Investment Ltd. Upon completion, the MOF will no longer hold shares in the three AMCs and Huijin will become their controlling shareholder; the three AMCs will remain state-controlled financial institutions.

Industry observers note the transfer forms part of China's broader financial regulatory reform, under which operating financial institutions are no longer directly managed by regulators and the MOF. The transaction is purely a transfer of equity relationships and should have little impact on the companies' business and strategy.

BlackRock hands its Shanghai Changfeng office project to Standard Chartered

According to reports, a fund under US financial giant BlackRock, having failed to service the loan on a two-tower Shanghai office project, intends to hand the property to Standard Chartered. The fund bought the two office towers in 2018 with a loan of c. RMB 780 m. The loan matured in 2023 and had been extended by one year to end-September this year, but the lender refused a second extension. The project comprises Towers E and G of the Changfeng Ecological Business District in Putuo District, Shanghai, with total office area of c. 27,805 sqm.

Link REIT establishes a real estate investment platform to bring in third-party capital

On 13 February, Link REIT announced the formal establishment of Link Real Estate Partners, advancing its Link 3.0 strategic upgrade. Headed by group chief investment officer Sung Chun-yin as CEO, the platform aims to introduce third-party capital through "REIT-plus" solutions and invest across risk profiles in Asia-Pacific real estate. Link 3.0 adopts an asset-light model, balancing property management with the growth of the funds business. The new platform will expand through joint ventures, co-investments and management contracts.

Swire Properties flags a first loss of c. HKD 800 m

On 7 February, Swire Properties released its Q4 2024 operating data report and 2024 financial performance update. The company expects recurring underlying profit attributable to shareholders of c. HKD 6.5 bn for the year ended 31 December 2024, versus HKD 7.3 bn in 2023, mainly reflecting higher net finance charges and lower office rental income in Hong Kong.

Wanda sells its Yangzhou and Siping Wanda Plazas

On 6 February, Siping Wanda Plaza Investment Co., Ltd. and Yangzhou Wanda Commercial Plaza Co., Ltd. completed equity changes. Dalian Wanda Commercial Management Group exited as shareholder of both companies, with Kunhua (Tianjin) Equity Investment Partnership (Limited Partnership) becoming sole shareholder. These are the sixth Wanda Plaza projects sold by Wanda since the start of 2025.

Vanke: Bloomberg reports authorities considering USD 6.8 bn to support debt repayment

On the afternoon of 12 February, Bloomberg reported that the authorities are considering providing Vanke with USD 6.8 bn to help repay debt. According to people familiar with the matter, a funding gap of c. RMB 50 bn (c. USD 6.8 bn) would be filled this year, underscoring government support for the distressed developer. Details of the plan may still change, and it is unclear whether Vanke has begun any specific bond issuance. On the news, Vanke's A-shares surged to the daily limit in late trading, its H-shares jumped more than 16%, and Hong Kong-listed mainland developers rallied across the board.

Market Pulse

Shenzhen Metro to provide Vanke with a RMB 2.8 bn shareholder loan

Vanke announced on 10 February that its largest shareholder, Shenzhen Metro Group, intends to provide a RMB 2.8 bn shareholder loan at an annualised rate of 2.34%, below the 1-year LPR published by the National Interbank Funding Center. Vanke will pledge Onewo shares worth RMB 4 bn as collateral at a 70% pledge ratio. The loan will be used to repay principal and interest on the company's publicly issued bonds.

Shenzhen Metro currently holds 27.18% of China Vanke, making it the company's largest shareholder.