RMB1 Trillion Allocated for Major Development in Shenzhen

At least RMB1 trillion has been allocated on a major development program as planned by the Shenzhen government. This major development includes building of homes that would provide a total floor area of 30 million square meters by 2025.

The redevelopment program would also include villages in urban areas and old factory to increase Shenzhen’s industrial zone to 100 square kilometer. Also on the drawing board are public service facilities, hospital and education.

According to preliminary data compiled by China Real Estate Information Corp, combined contract sales plunged 39.7 percent from the corresponding month in 2021 to 523.1 billion yuan. The demand remained stagnant amid an economic downturn despite government efforts to stimulate purchases.

Overall market demand and purchasing power have been overdrawn while industry confidence is also at a low level, developers are still facing heavy de-stocking pressure in the short term.

The big thinking in Shenzhen was revealed as the mainland’s top 100 developers saw home sales slump further in July, indicating a widening mortgage boycott crisis emerging around the country that is in turn weighing on buyer confidence.

The year-on-year decline in home sales was, however, less than in the previous month when there was a 43 percent decrease. Additionally, combined sales plummeted 49 percent in the first seven months.

China Resources Land as a borrower, entered into a facility agreement for a US$100 million dual currency term loan facility with a bank yesterday. The loan facility has a term of 364 days from the date of the first drawdown.

Meanwhile, shares of mainland developers and their property service arms fell, reflecting a worry over the transfer of debts to the parents.

Nan Hai, now controlled by Yu Pun Hoi, signed a strategic cooperation agreement with Shenzhen China Merchants Real Estate, a wholly-owned subsidiary of China Merchants Shekou Industrial Zone Holdings, on Nan Hai’s Phase 5 of The Peninsula project at Shekou in Shenzhen.

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