ROOM FOR GROWTH

Business Traveller (Asia-Pacific) - - CON­TENTS -

The busy dis­trict sur­round­ing Shang­hai’s Hongqiao air­port is de­vel­op­ing rapidly into a new CBD

Down­town Shang­hai is a fas­ci­nat­ing spec­ta­cle – two time-warped cityscapes di­vided by the snaking Huangpu River. On the west bank, The Bund’s mag­nif­i­cent colo­nial ar­chi­tec­ture forms an im­pres­sive façade to Puxi, the his­toric and cul­tural cen­tre, while across the river fu­tur­is­tic sky­scrapers sig­nal the gleam­ing new me­trop­o­lis of Pudong.

The younger east­ern dis­trict has cap­tured the lion’s share of mod­ern busi­ness ac­tiv­ity, thanks to key in­fra­struc­ture and fi­nan­cial in­sti­tu­tions such as Shang­hai Pudong In­ter­na­tional Air­port, the Lu­ji­azui Fi­nance and Trade Zone and two of three Shang­hai Stock Ex­changes, plus in­ter­na­tional fa­cil­i­ties in­clud­ing the Shang­hai World Expo Ex­hi­bi­tion and Con­ven­tion Cen­tre.

But the land­scape is set to shift again as a new CBD starts to emerge. Back in 2009, the gov­ern­ment be­gan plant­ing seeds for a new in­ter­na­tional busi­ness hub to ease the pres­sures on Pudong. Fast-for­ward al­most ten years and the Hongqiao cen­tral busi­ness dis­trict is start­ing to blos­som.

The 86 sq km zone strad­dles four neigh­bour­hoods to the west of down­town Shang­hai – namely the Qingpu, Min­hang, Jiad­ing and Changn­ing dis­tricts – and has been high­lighted in both the 12th and 13th Five Year Plans as a spe­cial area of rapid growth.

One of the aims is to cre­ate an eco­nomic gate­way to the pros­per­ous Yangtze River Delta re­gion, en­com­pass­ing pow­er­house sec­ond-tier cities such as Wuxi, Suzhou, Hangzhou and Ningbo. But the area is also be­ing tapped as a new in­ter­na­tional trade cen­tre, with a mod­ern ser­vice in­dus­try to at­tract busi­ness head­quar­ters and fi­nan­cial or­gan­i­sa­tions, and acres of mod­ern of­fice space in mixed-use de­vel­op­ments like the Hongqiao Van­tone Sunny World Cen­tre. MAK­ING CON­NEC­TIONS Com­ple­ment­ing these ob­jec­tives is the third strat­egy to har­ness the area as a ma­jor tran­sit hub and fa­cil­i­tate con­nec­tiv­ity through­out the rest of China. It’s no co­in­ci­dence that the CBD takes its name from Shang­hai Hongqiao In­ter­na­tional Air­port (SHA) – the city’s sec­ondary air­port is just ten min­utes from Hongqiao’s com­mer­cial cen­tre and a ma­jor part of the area’s ap­peal.

Pri­mar­ily a do­mes­tic hub (though there are a few in­ter­na­tional ser­vices to desti­na­tions such as Korea and Ja­pan op­er­at­ing from Ter­mi­nal 1), the 80-year-old fa­cil­ity has been given a new lease of life re­cently with a planned se­ries of soft up­grades. In March, Ter­mi­nal 1 un­veiled a re­vamped Build­ing A, with up­dated checkin fa­cil­i­ties plus more re­tail and F&B op­tions, while fur­ther up­grades are due to be re­vealed in Build­ing B and Ter­mi­nal 2 by 2018. The Shang­hai Air­port Au­thor­ity also an­nounced it will build a new hangar fa­cil­ity for busi­ness jets at Hongqiao air­port by April 2018 to cope with the ris­ing de­mand.

Be­yond air links, a key com­po­nent in en­hanc­ing the re­gion’s tran­sit prow­ess was the cre­ation of the Hongqiao Trans­port In­ter­change (HTI), or Hongqiao Tran­sit Hub, which opened in time for the 2010 World Expo. This is the world’s largest mul­ti­modal trans­porta­tion cen­tre, con­nect­ing air, rail, road and sub­way in one gi­ant fa­cil­ity. The com­plex di­rectly links the (do­mes­tic) Ter­mi­nal 2 of Shang­hai’s Hongqiao In­ter­na­tional Air­port with Shang­hai Hongqiao Rail­way Sta­tion – which op­er­ates three high­speed rail lines to Bei­jing, Hangzhou and Nan­jing, as well as two metro lines (Lines 2 and 10) to down­town Shang­hai and sur­round­ing ar­eas.

Ac­cord­ing to John O’Shea, Lang­ham’s Cordis brand vice pres­i­dent and man­ag­ing di­rec­tor of the up­com­ing Cordis Hongqiao, the strat­egy is work­ing: “A lot of cor­po­ra­tions are now bas­ing them­selves out here. In the area where Cordis will be open­ing, Roche and Shell are go­ing to be head­quar­tered, and HSBC is open­ing up of­fices here too. A lot of cor­po­rates are mov­ing out to Hongqiao just for the con­ve­nience of be­ing able to get to places very quickly.”

The Shang­hai Daily re­ported that more than 650,000 em­ploy­ees are ex­pected to work for en­ter­prises based in the zone by the end of 2020. To ac­com­mo­date pro­fes­sion­als from both home and abroad, a num­ber of res­i­den­tial com­mu­ni­ties have been planned and lo­cals are view­ing the po­ten­tial hous­ing boom ea­gerly.

“If you have the money, now is the per­fect time to in­vest,” ad­vises Elyn Hu, Sof­i­tel Shang­hai Hongqiao’s di­rec­tor of sales and mar­ket­ing. “Res­i­den­tial sales of apart­ments are go­ing up – three years ago the sale was about RMB40,000 [US$5,795] per sqm, now it is RMB78,000 [US$11,300] per sqm as con­fi­dence in the re­gion grows and we see more res­i­dents.”

EN­TICE THE MICE

The open­ing of the Shang­hai Na­tional Ex­hi­bi­tion and Con­ven­tion Cen­tre (NECC) – in stages from Septem­ber 2014 to June 2015 – was a wa­ter­shed mo­ment for the area. The enor­mous, sil­ver four-leaf clover struc­ture is the largest sin­gle-build­ing event space in the world at 1.47 mil­lion sqm. In­door space in­cludes 13 large ex­hi­bi­tion halls (28,800 sqm each), three small halls (10,000 sqm each), more than 60 meet­ing rooms of dif­fer­ing size and a com­mer­cial cen­tre pro­vid­ing ad­di­tional sup­port in the form of VIP lounges, F&B fa­cil­i­ties, en­ter­tain­ment and bou­tique shops.

Some of China’s big­gest an­nual shows have al­ready shifted from Pudong to the NECC. In 2015, for ex­am­ple, a to­tal of 928,000 vis­i­tors came to the 16th Shang­hai In­ter­na­tional Au­to­mo­bile In­dus­try Ex­hi­bi­tion (Auto Shang­hai), with more ex­pected at the event’s 17th edi­tion (which hap­pened last month).

The un­usual clover shape of the NECC is both an ar­chi­tec­tural state­ment and a nod to the green ini­tia­tives that are be­ing ap­plied to the area, with the gov­ern­ment com­mit­ted to trans­form­ing the en­tire CBD into a low-car­bon and green con­struc­tion com­mu­nity.

An­other ex­am­ple of this is the mod­ern glass-fronted, mixed-use project be­ing devel­oped di­rectly op­po­site the NECC – the Hongqiao World Cen­ter de­vel­op­ment from the Green­land Group, which has achieved LEED Gold cer­ti­fi­ca­tion. When com­plete, the de­vel­op­ment will house the five-star Primus and four-star Qube ho­tels, plus a lux­ury ser­viced res­i­dence, shop­ping cen­tre, of­fice space and other sup­port fa­cil­i­ties for the ex­hi­bi­tion cen­tre.

Mini Wang, di­rec­tor of mar­ket­ing and com­mu­ni­ca­tions for Green­land Hongqiao World Cen­ter Ho­tels, re­veals even lo­cal-brand ho­tels like Primus are tar­get­ing in­ter­na­tional guests: “We’ve al­ready seen big num­bers of for­eign­ers and in­ter­na­tional com­pa­nies from the road­shows and ac­tiv­i­ties in the NECC, and we’re hop­ing to cap­ture an in­ter­na­tional clien­tele. Most of our man­age­ment team have worked for in­ter­na­tional brands be­fore, and we carry that cul­ture to this Chi­nese-brand ho­tel.”

Per­haps the big­gest in­di­ca­tor that the Hongqiao CBD is re­ally start­ing to boom is the sud­den wave of five-star in­ter­na­tional ho­tels flock­ing to the re­gion. Last year saw the open­ing of In­ter­con­ti­nen­tal Shang­hai NECC, the Sof­i­tel Shang­hai Hongqiao, Le Meri­dien Shang­hai Min­hang, and Gran Melia Shang­hai Hongqiao. This year they have al­ready been joined by Hil­ton Gar­den Inn, with Lang­ham’s Cordis Hongqiao, Hy­att Place and Ritz-Carl­ton also set to open soon.

Leisure op­tions cater­ing to in­ter­na­tional trav­ellers are also in­creas­ing. The Hub is one such ex­am­ple, a 62,000 sqm shop­ping com­plex lo­cated about a fiveminute walk from Hongqiao Rail­way Sta­tion. The South Mall con­tains a six-storey shop­ping cen­tre and per­for­mance hall, while the North Mall is mainly com­prised of of­fices, high-end restau­rants and a five-star ho­tel. It also pro­vides an air­port check-in and shut­tle bus ser­vice – the only shop­ping mall in Shang­hai to of­fer this func­tion.

At present, more than 85 per cent of the planned Hongqiao CBD is un­der de­vel­op­ment or has been leased to var­i­ous com­mer­cial ten­ants. In other words, the dis­trict is en­joy­ing the fi­nal calm be­fore the storm. The story of the next 12 months will no doubt be a whirl­wind of new open­ings, in­ter­na­tional events, busi­ness de­vel­op­ment and eco­nomic growth.

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Clock­wise from top left: Hongqiao Trans­port In­ter­change; In­ter­con­ti­nen­tal NECC; and Hongqiao Rail­way Sta­tion

This im­age and be­low: Hongqiao World Cen­ter

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