CBRE: China's high-speed rail network will change property landscape

BEIJING: CB Richard Ellis's (CBRE) Asia Research Report details how China's high-speed rail network will change the property landscape of the country, it said in a press release on Monday, Dec 6. The network will bring new opportunities for real estate development that will serve as station-based central business districts.

"According to the report, by 2020, the total length of China's national railway system will grow to 120,000km," CBRE said.

The network will connect roughly 80 cities grouped in nine major urban regions, including the Bohai Rim, the Yangtze River Delta, the Pearl River Delta, the Changsha-Zhuzhou-Xiangtan Sphere, the Chengdu-Chongqing Corridor, Central Henan, the Wuhan City Cluster, the Guanzhong Agglomeration and the Western Taiwan Strait Economic Zone.

"The areas surrounding the future high-speed rail stations are being planned as integrated development zones providing an array of inter-linked office, retail, hospitality and residential properties," CBRE said.

The report did highlight that construction of such an extensive rail network could cause massive public debt. A way to counter this is for the Ministry of Railways to capitalise on the population living in buildings in the new development hubs to serve as a catchment area for the rail system.

The model of developing property projects in and around railway stations were pioneered by Japan.

"In Kyoto, five hotels, two department stores and several art galleries were built in and around the city's railway station, which is now a major business center with the highest passenger numbers of any area in the city," CBRE said.

The CBRE Research Asia report estimates that it will take five to 10 years for the suburban areas surrounding railway stations in all of the cities served by the high-speed rail network to evolve toward maturity.
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