Sinocircle

Digging around the Drum and Bell for underground malls.

An aquaintance was proud to be a foreigner attending one of the first community meetings in Beijing held regarding the proposed destruction of a large historical area north and east of the Beijing lakes.  Luckily he owned the building in which the store he ran was located, so he will not only receive payment but an invitation to attend this community meeting.

In yesterday’s telegraph:

“Basically the local government has been given £500m and told to spend it in order to boost tourism and tax revenues in the area. With so much money behind the project, it’s hard to see them not pushing it through,” the source added.
Several hundred people had been expected to attend a public meeting to raise awareness of the threat to the Drum and Bell last weekend, but on Friday it was abruptly cancelled by the Beijing Cultural Heritage Protection Center, apparently under official pressure.

So he did not get to the meeting, and few meetings are actually held after the newspapers report them, but you might not know that.   Anyway, the article explained that this project had been tried before in even 5th tiere cities.  Entire boulevards had been dug up and new property created where before there was none.  It worked, and when government unofficial surveyors found the public opinion would be scuttled the community meeting was called off.

Under question is an older area of mostly refurbished hutong alleys hosting stores, galleries, restaurants and bars.  The money here is palpable.  The tourist content is saturated by backpackers, walkers, and the rich.  Unlike many Chinese cities, Beijing does not have a single center.  Where this project has been attempted it has increased not only tax revenue but also a one-off sale of land that does not have to be bought, only created.  Most western cities do not have one single center.

There is a physical center in nearly all provincial cities.  Emulating these designs, the remaking of this area will be an unprecedented project in creating real-estate for Beijing, but something that has been tested and proven profitable only outside major urban areas.  While this is not a city center it is a bet on property.  Is there more going on here than meets the eye.

In yesterday’s telegraph:

The plan is allied to an ambitious 20-year project to create an “underground city” by digging out three square miles of northeastern Beijing to create a network of shopping malls, car parks and even a three mile underground mall.

The only sector still guaranteed to return a short term profit is real estate.  And the time is ripe, if not for the building, then for deals.