GRA Market Weekly (2026-03-14)

Policy Watch

Ministry of Natural Resources overhauls land rules, putting livelihood needs at the core

On 5 March, the Ministry of Natural Resources and the National Forestry and Grassland Administration jointly issued the Notice on Further Strengthening Natural Resource Factor Support, setting new rules for land use: newly added construction land is to prioritise major projects and livelihood programmes and, in principle, will no longer be used for for-profit real estate development - marking a fundamental shift in land supply logic.

The policy does not prohibit land for real estate development; rather, it controls "newly added construction land" (i.e. incremental land converted from agricultural use). Development can still draw on existing construction land, including old-town redevelopment, urban village renewal and the redevelopment of low-efficiency industrial land. The policy also establishes an "increment-linked-to-stock" mechanism, requiring that each province's new urban-rural construction land not exceed the area of existing land revitalised in the same year - pushing cities toward intensive development. Developers' land acquisition logic will be restructured, with urban renewal and redevelopment projects becoming the mainstream arena.

In addition, the Two Sessions set the core of 2026 property policy as "controlling increments, destocking and optimising supply": encouraging purchases of existing homes for affordable and talent housing, advancing housing provident fund reform and green smart housing, while expanding completed-home sales pilots and strengthening presale escrow oversight to further shore up market stability.

Multiple cities optimise housing provident fund schemes to strengthen livelihood support and activate the market

Chengdu: plans to raise the maximum provident fund loan to RMB 800,000 for single contributors and RMB 1.2 m for dual contributors, temporarily removing limits on the number of loans, with a 20% uplift for completed-home sales projects; adds urban renewal projects as a new withdrawal scenario.
Fuzhou: introduces a home renovation withdrawal policy at RMB 1,500/sqm; expands purchase-related withdrawals to anywhere in Fujian Province and adds withdrawal rights for spouses' parents.
Dazhou, Xi'an and other cities are simultaneously optimising provident fund policies - simplifying withdrawal procedures, facilitating cross-city loans and extending withdrawals to property management fees and deed tax - lowering the cost of home purchase and occupancy.

Market Watch

Shanghai: first land auction round of 2026 closes with RMB 6.8 bn in proceeds

On 13 March, Shanghai completed its first batch of residential land sales of the year, transacting three plots for total proceeds of c. RMB 6.809 bn. The plots are located in Xuhui, Jiading and Qingpu districts, with a combined site area of c. 10.06 ha and planned GFA of c. 198,400 sqm. The Changqiao commercial-residential plot in Xuhui went to Shanghai Industrial Urban Development at reserve price for RMB 2.675 bn, an accommodation value of c. RMB 48,500/sqm (residential floor price around RMB 65,000/sqm). The pure residential plot beside Baiyin Road Station in Jiading New Town was taken by a Xiangyu-China Jinmao consortium at the reserve price of RMB 1.45918 bn, or RMB 24,500/sqm. The Xujing 18-05 plot in Qingpu, contested by Greentown and Xiangyu over 33 rounds of bidding, ultimately went to Greentown for RMB 2.67496 bn, an accommodation value of c. RMB 32,000/sqm at a 6.57% premium.

Hangzhou: core Qianjiang Century City plot in Xiaoshan clears at a 16.11% premium

On 10 March, a low-density residential plot in Qianjiang Century City came to market. Located east of Country Garden Longyue and c. 500 m from Aoying Mingcui, the plot carries a plot ratio of 1.8 - the lowest for any residential plot in Qianjiang Century City in nearly a decade - with a height cap of 54 m, buildable GFA of 41,600 sqm, a starting price of RMB 1.366 bn and a starting floor price of RMB 32,800/sqm. The planning conditions require a series of ancillary facilities including community premises, a cultural activity room and a rehabilitation station; the height ratio between the tallest and lowest parts of new residential buildings must not exceed 3:1, the lowest section must be at least four storeys, and villa-type products (courtyard or semi-detached) are not permitted.

The plot drew 13 registered developers. After 23 rounds of bidding, Poly Developments won at a floor price of RMB 38,084/sqm, a 16.11% premium - only c. RMB 1,600/sqm above the Lixiangting land price of February last year (RMB 36,486/sqm). This is Poly's second recent high-premium acquisition in Hangzhou after the Chengdong New Town plot, sweeping both plots offered in the new year.

Changsha: first residential plot of the year sells at a premium for RMB 183 m

On 11 March, a core residential plot in Yuhua District transacted at RMB 183 m, a 13% premium. The plot covers 10,540.54 sqm (15.81 mu), zoned Class II residential (R2) with a plot ratio of no more than 2.8. The starting price was RMB 162.4 m, equivalent to a starting floor price of c. RMB 5,503/sqm. A consortium of Yongzhou Zishui Lantu Consulting, Yongzhou Hemu Project Management and Yongzhou Renhe Xianju Real Estate Development won at RMB 183.46 m, a 13% premium, for a final floor price of c. RMB 6,216/sqm.

Commercial real estate supply-demand balance gradually improving; en-bloc transaction value set to keep growing

CBRE recently released its China Real Estate Market Outlook 2026, assessing commercial leasing and investment trends: despite lingering macroeconomic and geopolitical risks, more attractive asset pricing and an improving financing environment should drive modest 5%-10% growth in nationwide en-bloc property transaction value in 2026.

In 2025, deal count in the national en-bloc investment market fell 30% YoY to 354, but mega retail and data centre portfolio transactions lifted total value 12% YoY to RMB 254.7 bn. Commercial real estate cap rates are expected to stabilise at elevated levels, with PBoC reserve-ratio and rate cut expectations and the public REITs market adjustment as core drivers.

Investment appetite diverges by asset class:

Industrial and logistics remains the most favoured asset class, with 96% of investors focused on high-standard warehouses; central-western China and East China are the key investment targets
Rental housing en-bloc transactions reached a record RMB 11.9 bn in 2025, with Beijing and Shanghai contributing over 70%; core-location long-term rental and student housing are prime targets
Retail is polarised, with outlets and community retail leading revenue growth and standing out for defensiveness
Offices gain an opening from inclusion in public REITs; Grade A office vacancy in tier-1 core CBDs stands at 14%, well below the citywide 22%

REITs Watch

Seazen Holdings: commercial real estate REIT application accepted, with two Wuyue Plazas in the seed pool

On 6 March, Seazen Holdings formally submitted its commercial real estate REIT application to the CSRC and the Shanghai Stock Exchange, and the filing has been accepted. The sponsor (original equity holder) of the public REIT is Wuyue Shunrui (Shanghai) Commercial Management, with GF Fund Management as fund manager and Ruiyuan Capital Management as manager of the asset-backed plan.

The underlying assets are two Wuyue Plazas in Jiangsu - Changzhou Tianning Wuyue Plaza and Nantong Qidong Wuyue Plaza - with a combined valuation of RMB 2.143 bn. On the leasing side, as of 30 September 2025 the Tianning project had 235 signed tenants at 97.15% occupancy, while the Qidong project had 180 signed tenants at c. 100% occupancy. Based on full-cycle net operating income, first-full-year (2026) cap rates are estimated at 6.11% for Tianning and 6.44% for Qidong.

Corporate Watch

Another RMB 754 m land play: TCM giant Pien Tze Huang doubles down on Beijing

On 10 March, Pien Tze Huang (600436) won an industrial plot in the Daxing biomedicine industry base at the reserve price of RMB 80.13 m. Per the tender notice, plot DX00-0502-0080 covers c. 35,000 sqm (c. 53.4 mu) with GFA of nearly 50,000 sqm, zoned for industrial plants on a 30-year term for biomedicine-related projects. The reserve-price deal works out to c. RMB 1,607/sqm, with required output of no less than RMB 19.39 m per mu and tax contribution of no less than RMB 1.08 m per mu.

The plot will host Pien Tze Huang's Northern Health Intelligent Manufacturing Base, with total investment of c. RMB 754 m, construction starting in October 2026 and completion in April 2028. At full capacity, the project is expected to generate annual output value of RMB 1.18 bn and 230 new jobs. The acquiring entity, Pien Tze Huang (Beijing) Health Technology Development Co., was established last December with registered capital of RMB 90 m, wholly owned by Zhangzhou Pien Tze Huang Pharmaceutical.

Notably, at end-2024 Pien Tze Huang injected an additional RMB 1 bn to establish an innovation R&D base in Daxing and bought an office tower as its northern headquarters - Tower E of Xingchuang International Center, acquired for RMB 753 m, an 18-storey building with 25,000 sqm of GFA (c. RMB 30,000/sqm); the "Pien Tze Huang" signage is already visible on the building. The company has also successively set up its northern marketing headquarters, a Beijing industrial conversion base and a Fujian-Taiwan (Beijing) base.

Overseas Watch

Hong Kong raises stamp duty on ultra-luxury homes to 6.5%

Effective 26 February 2026, the Hong Kong government raised the stamp duty rate on residential property transactions valued above HKD 100 m from 4.25% to 6.5%.

The adjustment stems from the 2026-27 Budget and is aimed at the fiscal goal of "those with means paying more". It is expected to affect c. 0.3% of residential transactions and add c. HKD 1 bn in annual tax revenue.

The industry broadly sees limited impact on the overall luxury market, as ultra-high-net-worth buyers are relatively insensitive to tax costs and Hong Kong's luxury tax burden remains internationally competitive.

Industry Outlook

In 2026 the property sector will continue along "policy backstop, market divergence and stock dominance", transitioning from scale expansion to quality upgrading, with investment opportunities taking on a structural character.

On the policy side, land supply logic keeps shifting, stock revitalisation is the core theme, provident fund optimisation activates first-time demand, and policy divergence intensifies. On the market side, land auctions are sharply polarised: prime plots in core cities are hotly contested while lower-tier cities still face destocking pressure.

On the corporate side, developers' land acquisition logic is being rebuilt, opportunities stand out in urban renewal and REITs, and cross-sector expansion is becoming more rational. Overall, the industry is entering a high-quality development stage of "deflating bubbles, returning to fundamentals and sharpening divergence".