Dis­ney Re­sort to bring realty boom in China

The Pak Banker - - COMPANIES/BOSS -

Lu Jianxin, a real es­tate agent with Shang­hai Huayu Prop­erty Ltd, has had some of his busiest busi­ness weeks in Jan­uary since he joined the sec­tor in 2002. Lu re­ceives more than 50 phone calls ev­ery day ask­ing him if he can find un­oc­cu­pied retail prop­er­ties near Shang­hai Dis­ney Re­sort, the long-an­tic­i­pated multi-bil­lion-dol­lar amuse­ment pro­ject that is sched­uled to open this sum­mer (June).

Typ­i­cally, Lu tells his call­ers 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 Dis­ney­land," said Lu.

It's not just busi­ness-minded peo- ple who are all ex­cited about Shang­hai Dis­ney. Even 13-year-old Zhang Zi­hao in Hangzhou, Zhe­jiang prov­ince, can't wait for Dis­ney to open its gates. He has been sav­ing his pocket money for a long time so he could visit Shang­hai Dis­ney Re­sort dur­ing the sum­mer va­ca­tion.

"The ad­mis­sion ticket price is ex­pected to be an­nounced this week. I have saved 500 yuan ($75.92) so far for the ticket alone, and an­other 1,000 yuan for din­ing and ac­com­mo­da­tion, and an­other 500 yuan for mer­chan­dise like stuffed an­i­mals, sta­tionery, T-shirts and gifts for friends. That's about 2,000 yuan in to­tal."

The pro­ject has been un­der con­struc­tion for more than six years now. Jun 16?that is, 6-16-2016?has been ap­par­ently cho­sen as the date of open­ing be­cause the three 6s are be­lieved to be aus­pi­cious, herald­ing suc­cess. Real es­tate pro­fes­sion­als be­lieve any suc­cess of Shang­hai Dis­ney Re­sort would en­tail all-round ben­e­fits for the area. For ex­am­ple, vis­i­tors in huge num­bers would likely spark a retail boom in Shang­hai.

Ac­cord­ing to Cen­taline Prop­erty Agency, the av­er­age price of com­mer­cial prop­er­ties within a 5 kilome­ter ra­dius of Shang­hai Dis­ney Re­sort, in­clud­ing shops and restau­rants, has grown more than 300 per­cent in the past five years. What used to cost some 20,000 yuan per square me­ter in 2011 would now com­mand a price of more than 60,000 yuan per square me­ter. Some prop­er­ties are even priced more than 72,000 yuan per square me­ter, about 50 per­cent higher than that of other sub­ur­ban ar­eas in Shang­hai.

The growth rate is among the high­est for premier lo­ca­tions such as Nan­jing Road, Huai­hai Road and Lu­ji­azui. In com­par­i­son, the av­er­age price of res­i­den­tial prop­er­ties in the same area dou­bled from 20,000 yuan per square me­ter to 40,000 yuan per square me­ter in the same pe­riod, sim­i­lar to that of the city's av­er­age growth rate.

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