The Impact of New Subway Construction on Development Patterns and Land Values in Beijing Kevin Denny—Department of Geographical Sciences—University of Maryland, College Park

Introduction Case Study – Wangjing, NE Beijing Quant. Results / Analysis Estimated HP Model Coefficients Recent construction on the Beijing subway has been The Wangjing region in the Chaoyang District on the A total of 103 residential and 45 commercial occurring at a very rapid pace - more than 500 NE fringe of Beijing was the first case study selected developments were identified for analysis within the W Constant FAR Year Subway Dist. Dist. kilometers of track were constructed across the for analysis. Wangjing is located at the (current) Wangjing region. The per sq. meter values of these Value Dist. From From Reg. City city from 2007 – 2013. A total of 9 new subway lines western terminus of Subway Line 15 (opened in developments, along with the (Z-Score) results of a Cent. Cent. opened during this period, with new lines opening up 2010) , including it’s intersection with Subway Line 13 Getis-Ord Gi* hot spot analysis, are mapped below. Wangjing .4466 12323.61 -992.16 506.8 -3.169 4.242 0.3938 in both the center of the city and all across the city’s (opened in 2002). suburban fringe. Guomao .1728 60404.28 -586.66 1293.8 -15.835 -7.104 -0.789 Future expansion plans for the Beijing subway are equally ambitious; by 2020, officials expect the city’s As hypothesized, a significant premium can be subway to grow to over 1000 km in length, making it observed for real estate located in close proximity to the world’s largest by a significant margin. It is clear subway stations in both case study regions. However, that Beijing officials realize the importance of an this premium is more than 5x higher in Guomao – this excellent subway system for a global city of it’s size is likely a result of the buildings immediately adjacent and stature. to the subway stations along Line 10, many of which are directly connected to the subway platforms. in light of these massive investments in subway infrastructure, it is particularly important for the long term viability of the city that development patterns in Wangjing is a rapidly growing region – close to 50% of Conclusion Beijing shift dramatically from the auto-centric the development in the analysis area was constructed Based on the results obtained from the Wangjing and development that proliferated during the city’s rapid after 2007, when the Subway Line 15 was first publicly 3 distinct hot-spots for property value can be observed Guomao case studies, it is apparent that new subway expansion in the 1990’s. For the new subway lines to announced. Prior to this point, most development in in Wangjing, to the North, East and South of the construction has had a significant effect on both truly be a worthwhile investment, Beijing officials need Wangjing had been concentrated along the highways central Wangjing station. Note that only cluster development patterns and land values. Since the to work to ensure that development patterns in the to the region’s south and east. Since the furthest to the East is statistically significant; this is announcement of Subway Lines 6, 10 and 15 in 2007, future are truly focused around capturing the value of announcement of Line 15, much of the development likely due to the recently constructed Soho New Town significant development has occurred in both regions the city’s increasingly abundant transit infrastructure. has shifted towards the center of the region in the development, which is valued at nearly double the along the new subway lines – it can be reasonably vicinity of the 3 subway stops. average per sq. meter rate for the rest of the region. inferred that new subway construction has been a primary catalyst for much of this development.

Methodology Case Study – Guomao, SE Beijing While Guomao and Wangjing alone are likely not descriptive of the entirety of Beijing, the observed Quantitative – Point-Based Analysis The Guomao region in the Haidian District in the SE A total of 77 residential and 96 commercial premiums for properties in close proximity to transit are Employed the following Hedonstic Pricing (HP) model region of Beijing was the second case study selected developments were identified for analysis within the quite in-line with the results observed in Zhang’s 2013 to estimate the impact of proximity to subway for analysis. It is located at the intersection of Subway Guomao region. The per sq. meter values of these study of transit-proximity premiums in other areas entrances on real estate values, when controlling for Line 1 (Beijing’s oldest and busiest) and the Loop developments, along with the results of a Getis-Ord across Beijing. Of particular interest to the researcher is other possible explanatory values such as Line 10 (Opened fully in 2010; already among the Gi* hot spot analysis, are mapped below. the significant premium for buildings along Line 10 in construction year, Floor Area Ratio (FAR) and Green system’s busiest lines). Subway Line 6 (also Guomao, many of which are “transit-focused” and Area Ratio: completed in 2010) runs along the northern boundary directly connected to the subway platforms. Further of the region. research hopes to look into the dichotomy between “transit-focused” developments such as these and Where: developments that are merely adjacent to transit – it is pi: Average price of the ith residential unit, Yuan/m2 believed that a deeper understanding of this will prove χki: The kth attribute of the ith residential unit invaluable to urban planners and transportation di: Distance to the nearest metro station in meters (m) planners across the globe. εi random error term α0,αk,β: coefficients to be estimated. References Quantitative – Blocks-Based Analysis Demarcated blocks using a combination of Baidu Ding, C., & Zhao, X. (2014). Land market, land Maps and Satellite Imagery to analyze data about development and urban spatial structure in Beijing. Land developments on a polygon level. The following Use Policy, 40, 83-90. statistics were computed for each block and analyzed Guomao is known by some as Beijing’s “New CBD”, Yang, Z., Cai, J., Ottens, H., & Sliuzas, R. (2013). Beijing. due in part to it’s high density of foreign firms. Unlike spatially: Significant hot spots for property values can be Cities, 31, 491-506. Wangjing, significant development existed in the - Average Value, Yuan / m^2 observed in the vicinity of all 3 stations along Line 10 Zhang, M., & Wang, L. (2013). The impacts of mass transit Guomao region even before new subway construction - Average Construction Year in the center of the region. Many of the developments on land development in China: The case of Beijing. - Average Floor Area Ratio in the region (likely due to it’s location on the 3rd Ring in these clusters are truly “transit-focused”, with direct Research in Transportation Economics, 40(1), 124-133. - Block Density: Total Building Area / Total Block Area Road). Infill development has still been occurring A special thanks is due to Dr. Zlatic, Dr. Liang and Dr. Sun - Land Productivity: (Total Building Area * Average passages to the subway platform from their lobbies steadily in the region – nearly 30% of the from the UMD Geographical Sciences department for Value) / Total Block Area that feature prominently in their building’s façade. developments in the area have been built since 2007. their advising and support throughout this project.