A FAIRY TALE IM­PACT

The open­ing of the new Dis­ney Re­sort in Pudong is set to give Shang­hai’s retail and prop­erty sec­tors a mas­sive boost

China Daily (Canada) - - SHANGHAI -

wuyiyao@chi­nadaily.com.cn

The start of the new year has been a very busy time for Lu Jianxin, a real es­tate agent with Shang­hai Huayu Prop­erty Ltd. He has been get­ting about 50 phone calls ev­ery day as hun­dreds of peo­ple have been ea­ger to find out if he can help them find retail prop­er­ties lo­cated near the Shang­hai Dis­ney Re­sort, which is sched­uled to open this sum­mer.

Lu’s re­sponse to most of them has largely been the same — that they should have acted ear­lier.

“Sup­plies of retail prop­er­ties are re­ally lim­ited now and prices have more than dou­bled in the past 12 months. Ob­vi­ously, in­vestors be­lieve that even a 10-square-me­ter space for a noo­dle stand will be re­ally prof­itable if it is close enough to the Dis­ney re­sort,” said Lu.

Af­ter more than six years of con­struc­tion and prepa­ra­tion, Shang­hai Dis­ney Re­sort is set to wel­come its first vis­i­tor on June 16. This par­tic­u­lar date was cho­sen be­cause the num­ber “6” — deemed an aus­pi­cious one that sym­bol­izes suc­cess —ap­pears sev­eral times.

Ac­cord­ing to data from Cen­taline Prop­erty Agency, the av­er­age price of com­mer­cial prop­er­ties within a 5-kilome­ter ra­dius around the Shang­hai Dis­ney Re­sort have grown more than 300 per­cent in the past five years, from some 20,000 yuan ($3,037) per square me­ter in 2011 to a peak of 72,000 yuan as of Jan­uary 2016. This phe­nom­e­nal growth rate was among the high­est in Shang­hai, sim­i­lar to those in prime lo­ca­tions such as Nan­jing Road, Huai­hai Road and Lu­ji­azui.

In com­par­i­son, the av­er­age price of res­i­den­tial prop­er­ties in the same area dou­bled from some 20,000 yuan per square me­ter to 40,000 yuan per square me­ter in the same pe­riod.

“Surg­ing prices of com­mer­cial prop­er­ties are a re­sult of lim­ited sup­plies and high de­mands. We es­ti­mate that the prices may grow fur­ther but at a more steady pace in the next half of 2016 af­ter the open­ing of the re­sort,” said Joe Zhou, head of re­search for JLL East China.

Real es­tate pro­fes­sion­als also be­lieve that the open­ing of the re­sort will help boost retail con­sump­tion across the en­tire city. The Dis­ney re­sort is ex­pected to re­ceive more than 10 mil­lion vis­i­tors in the first year, and the brand would as a re­sult gen­er­ate more than 45 bil­lion yuan across all its busi­nesses in the city, ac­cord­ing to a re­port by com­mer­cial prop­erty ser­vices firm RET.

When 70 mil­lion peo­ple vis­ited the Expo 2010 Shang­hai China, the com­bined con­sump­tion ex­ceeded 48 bil­lion yuan, ac­cord­ing to data from Shang­hai’s sta­tis­tics bureau. The ex­pen­di­ture on din­ing alone was more than 2 bil­lion yuan. Mar­ket in­sid­ers said that Shang­hai Dis­ney Re­sort’s im­pact on the retail mar­ket may be even more ob­vi­ous be­cause the re­sort is a per­ma­nent fa­cil­ity that can at­tract vis­i­tors to stay in the city for longer pe­ri­ods.

Lu Wenxi, man­ager of Cen­taline Prop­erty Agency, es­ti­mated that for ev­ery 1 yuan spent on ad­mis­sion tick­ets to the Dis­ney re­sort, an­other 8 yuan will be spent on din­ing, ho­tels and fran­chised prod­ucts.

“Just con­sider the more than 10,000 em­ploy­ees who work in the re­sort and their day-to-day con­sump­tion in the neigh­bor­hood. The com­bined size is huge, and it will not only ben­e­fit the

PHO­TOS PRO­VIDED TO CHINA DAILY

China's very own Dis­ney­land will be open af­ter more than six years of con­struc­tion and prepa­ra­tion.

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