Spotlight Savills China City Series - Nanjing May 2013
Total Page：16
File Type：pdf, Size：1020Kb
Savills World Research Nanjing Spotlight Savills China City Series - Nanjing May 2013 savills.com.cn/research savills.com.cn/research 01 Briefing |Savills China City Series - Nanjing May 2013 Spotlight Savills China City Series - Nanjing City introduction 5 Planning 8 Labour and education 9 International links 9 Quality of life 10 Grade A office market 11 Retail 12 Residential 14 Serviced apartment and hotels 16 Investment deals 17 savills.co.uk/research 02 Briefing |Savills China City Series - Nanjing May 2013 Executive summary FIGURE 1 Nanjing, also known as the southern Location of Nanjing capital, has a long history. In recent years, however, the city is better known as the provincial capital of Jiangsu. The city is synonymous with heavy industry but in fact over 50% of its GDP is now contributed by the tertiary industry. Supporting the manufacturing sector, Nanjing is a key transportation hub both for goods and people, acting as a gateway between the Yangtze River Delta and central/ western China, as well as an important stop on the Beijing–Shanghai railway segment. Supporting the tertiary industry, the city has a number of leading educational institutions, helping to position Nanjing’s tertiary education system among other leading cities, such as Xi’an and Wuhan, in the top five in the country. The commercial and high-end residential sectors are dominated by Xinjiekou, a name that is known throughout China. Xinjiekou straddles three districts, namely Gulou, Xuanwu and Baixia, and is the traditional heart of the city. Its younger pretender, Hexi central business district (CBD) is located in the west of the city in Hexi Source: Savills Research district. Although planning only started in 2002, Hexi CBD is already having a and street stores, in some ways similar the city, has yet to fully utilise the notable impact on the city’s property to Shanghai’s Xujiahui. Shoppers tend underdeveloped river views in the markets, with a handful of commercial to be locals or tourists from the north north of the city. mixed-use projects already completed of Jiangsu or neighbouring Anhui but many more currently under province, attracted to the city by its The residential leasing market is construction and expected to be relatively large retail stock (estimated dominated by the strata-title market. completed over the next three to five at 1.8 million sq m) and wide range There is only one serviced apartment years. The scale, superior quality, of low- to mid-end domestic and currently in operation, Fraser Suites and district master planning and international brands. This is in contrast Nanjing, with rents of approximately infrastructure will give this submarket a to the prime retail districts of Shanghai RMB150 per sq m per month. High- key advantage over the overcrowded which have been given over to mid- to end strata-title rents go for about city centre. high-end and luxury brands. half of this at RMB75 per sq m per month. Growing business operations The office market, with a history of 15 The residential market holds its own, of multinational corporations (MNCs) years, has a total stock of 780,000 sq with average transaction volumes should result in increased numbers m. However, this is expected to balloon over the last five years averaging of expatriates looking for quality over the next three years, with annual around 7 million sq m and prices accommodation, with a number of supply expected to average 300,000 over the last two years averaging serviced operators keen to enter the per annum. Much of this new supply is RMB11,000 per sq m. Buyers tend to market in order to be able to meet this located in Hexi CBD. While this will put be locals or families from the north of demand. pressure on both rents and occupancy Jiangsu and Anhui drawn to the city rates, state-owned enterprises (SOEs) by its plentiful educational resources. The investment market remains are expected to absorb much of the The highest prices in the city are small with only a handful of deals new supply, as several of the projects roughly RMB50,000 per sq m and having been concluded over the last are being developed for self use by can be found in the city core in close five years. This is partly due to the companies with ties to the state. proximity to Xinjiekou, with Hexi CBD lack of available investment-grade holding second place with the highest developments on the market and The retail market, as with many other prices averaging around RMB26,000 the risk-averse nature of investors to cities, is still led by the traditional city per sq m. The residential market, second-tier commercial markets over core, Xinjiekou. Department stores while utilising the natural landscape the last two years, combined with the dominate the region but there is also a offered by Zhongshan Scenic Area limited rental growth prospects for the heavy concentration of shopping malls and the Xuanwu Lake in the east of office market. savills.com.cn/research 03 Briefing |Savills China City Series - Nanjing May 2013 City overview TABLE 1 Macro data, 2011 Nanjing China Nominal 5-year Nominal 5-year Indicator Unit Real YoY Real YoY Value YoY CAGR Value YoY CAGR (%) (%) (%) (%) (%) (%) GDP RMB bil 615 22.7 13.4 12 47,288 17.8 12.2 9.3 Industrial output RMB bil 1,035 24.3 12.3 - 84,427 20.9 15.8 - (above designated size) Permanent population Mil 8.1 1.3 1.8 1.3 1,347 0.5 0.4 0.5 Fixed-asset investment RMB bil 401 21.3 16.5 - 31,149 23.8 17.8 - (FAI) GDP per capita RMB 75,785 16.8 10.8 - 35,181 17.2 11.8 - Urban disposable income RMB 32,200 13.7 9.6 - 21,810 14.1 9.6 - per capita Urban consumption RMB 20,763 14.4 9.4 - 15,161 12.5 8.7 - expenditure per capita Retail sales RMB bil 267 17.8 14.1 - 18,392 17.1 15.6 - Foreign direct investment US$ mil 3,566 26.6 12.7 116,011 9.7 9.2 - (FDI) Exports US$ bil 31 24 8.5 1,743 24.9 7.4 - Higher educational - 53 - - - 2,409 2.2 4.8 - institutions Enrolments in higher Mil persons 0.7 - 3.2 - 23.1 3.4 4.1 - education Highway freight volume Mil tons 198.2 12.1 9.3 - 28,201 15.2 11.5 - Waterway freight volume Mil tons 140.9 24.8 18.3 - 4,260 12.4 8.7 - Railway freight volume Mil tons 18.2 14.2 11.0 - 3,933 8.0 4.6 - Air passengers Mil 13.1 4.3 10.2 - 293 9.5 9.6 - Source: Nanjing Statistics Bureau, Savills Research City introduction velopment and international expan- expected to open in mid-2013 and A commercial hub on the Yangtze sion for MNCs. Over 250 leading several more high-speed railways un- River Delta domestic enterprises and MNCs der planning within Jiangsu province. Located 270 km from Shanghai in have established plants or regional the downstream area of the Yangtze representative offices in Nanjing, al- Nanjing also has the second highest River Delta, Nanjing is the capital of lowing them to expand their business highway density in Jiangsu province Jiangsu province and one of east to cities throughout the Yangtze River and was the second city in the Yang- China’s main centres of industry. Delta, north Jiangsu and Anhui prov- tze River Delta to have a Metro net- ince. By the end of 2010, companies work in operation. The development Nanjing has long been recognised from over 100 countries (or regions) of this infrastructure is expected to as an important political, cultural had a presence and numerous help strengthen regional integration and economic centre. At present, it Fortune 500 companies had made and accelerate the development of occupies the role of a major commer- substantial investments in over 150 Nanjing’s ‘One-hour Urban Circle,’ cial hub on the Yangtze River Delta. projects in Nanjing. which consists of Zhenjiang, Yang- According to the latest regional plans zhou, Huai’an, Ma’anshan, Chuzhou for the Yangtze River Delta, Nanjing A national transport hub and Wuhu. has been identified as a gateway for Nanjing is an important railway hub, promoting the development of central linking Shanghai with northern and Thriving private economy China, a national integrated transport western China. Two high-speed Jiangsu has a booming private hub and a centre of innovation and railway lines, the Shanghai–Beijing economy and the largest number of technology. and Shanghai–Chengdu lines, pass private enterprises of all of China’s through Nanjing. The city has de- provinces. Nanjing’s municipal gov- Its strategic location, largely priva- voted a significant effort towards in- ernment is keen to boost the devel- tised local economy and advantages tercity railway construction, with the opment of private enterprises, espe- in industrial production have given Shanghai–Nanjing line having opened cially small and medium enterprises Nanjing a key role in regional de- in 2010, the Nanjing–Hangzhou line (SMEs). Nanjing has introduced savills.com.cn/research 04 Briefing |Savills China City Series - Nanjing May 2013 TABLE 2 FIGURE 2 District information, 2010* Nanjing’s ‘One-hour Urban Circle’ Area Permanent Density District (sq km) population (persons per sq km) City-wide 6,587 8,004,680 1,215 Urban 260 3,358,069 12,891 Gulou 25 826,074 33,512 Baixia 26 602,031 22,813 Qinhuai 23 405,891 17,865 Xiaguan 28 445,117 15,701 Xuanwu 75 651,957 8,640 Jianye 83 426,999 5,149 Suburban 4,473 3,807,559 851 Yuhuatai 132 391,285 2,956 Qixia 381 644,503 1,692 Source: Savills Research Pukou 910 710,298 780 FIGURE 3 Jiangning 1,578 1,145,628 726 Nanjing district map Luhe 1,471 915,845 623 County 1,854 839,052 453 Gaochun 790 417,729 529 Lishui 1,064 421,323 396 Source: Nanjing Statistics Bureau, Savills Research * In January, 2013, Xiaguan and Gulou districts merged to become Gulou district; Baixia and Qinhuai districts merged to become Qinhuai district; and Gaochun and Lishui changed to administrative districts of Nanjing.