CBRE publishes Transformation and Opportunities of Jing-Jin-Ji City Cluster
September 19, 2018, Beijing – Commercial real estate opportunities will grow materially with improved accessibility and infrastructure in Northern China’s Jing-Jin-Ji area. According to CBRE’s Transformation and Opportunities of Jing-Jin-Ji City Cluster, Series 1: Infrastructure to Accelerate Integration, collaboration between Beijing, Tianjin and Hebei will ultimately open up new channels of commercial real estate demands and create opportunities for both occupiers and investors.
Growth prospects arising from Jing-Jin-Ji’s infrastructural development
The Jing-Jin-Ji urban cluster is comprised of two municipalities (Beijing and Tianjin), 11 prefecture-level cities (including Shijiazhuang, Baoding, etc. in Hebei Province), and the newly established Xiong'an. Accounting for only 2% of the nation’s land area and 6.5% of the total population, the Jing-Jin-Ji cluster contributes to 9% of the national GDP. As the details surrounding the Jing-Jin-Ji cluster’s development plans have materialized, we expect the cluster to overcome obstacles and make breakthrough progress in its infrastructural development, which will mobilize regional integration over the next few years.
Tin Sun, Head of Research, CBRE Northern China, explains:
“Xiong'an, Zhangjiakou, Chengde and Tangshan will be new additions to Beijing’s 1-hour transportation circle; and Shijiazhuang, Xiong'an and Baoding will become new regional transportation hubs, second only to Beijing, Tianjin and Langfang.”
“As new infrastructure and intercity transportation is delivered over the next five years, the cities within Beijing's 1-hour transportation circle will absorb additional demand arising from industrial development. Other cities will mainly rely on the organic growth of their economies to support commercial property demand.”
The Impact of Infrastructure on the Real Estate Market
Office
With a limited supply of office buildings in Beijing’s CBD, certain business functions have been squeezed out of this area. The four major areas around the capital’s half-hour economic circle – Beijing Sub-center, Xiong'an, Tianjin Central City and Tianjin Binhai New Area – will provide the largest concentration of office spaces in the future.
Christina Liu, Regional Managing Director / Executive Director, Advisory & Transaction Services | Office, CBRE Northern China, highlighted: “The office market in each central city will benefit from the development of enhanced transportation measures, which will effectively broaden the geographical area of the central city by pulling areas currently outside of the central city into the same network. Thus, this redefined, expanded central city will be able to meet the additional demand for office spaces. “
Liu continued: “The Beijing Sub-center, centered in the future capital economic circle, will benefit from its geographical location, and in Tianjin, emerging locations near the subway station will bring another wave of supply to the Central City. And, beyond the capital economic circle, Shijiazhuang, Tangshan, Baoding, Langfang and Qinhuangdao are also demonstrating great potential.”
Retail
Due to the functional transformation of Beijing and Tianjin running parallel to evolving consumption patterns, major changes will take place in retail property market.
Zino Helmlinger, Head of Advisory & Transaction Services | Retail, CBRE Northern China, notes “Overall retail property demand will not stagnate; on the contrary, the rapid increase in demand for experience-driven consumption and individualization has broadened the use of retail space, creating demand for prime largescale retail properties. Simultaneously, it is increasingly necessary for retail properties to serve different needs in the market, and place greater emphasis has been placed on positioning and differentiation. Office, residential and tourism are the three most prominent avenues of growth for retail properties in the Jing-Jin-Ji area, especially in core cities.
“The purchasing power of Shijiazhuang and Tangshan is growing, with Langfang, Qinhuangdao and Baoding also showing potential. As an increasing number of domestic and international operators enter the market and local operators upgrade their operation models, these markets will experience increased activity and diversification.”
Industrial
Regional logistics functions will shift out of Beijing; Tianjin and Langfang into Baoding; Shijiazhuang and Tangshan.
Rosemary Li, Head of Advisory & Transaction Services | Industrial, CBRE Northern China, believes, “Developmental prospects will be determined by the land market and the clustering of populations and industries. Tianjin, Langfang, Cangzhou, Beijing, Baoding and Shijiazhuang have the most noticeable advantages in terms of convenience. And, as new infrastructure is gradually implemented over the next few years, Tangshan, Chengde and Hengshui will see greater highway mileage.”
Li added, “Beijing and Tianjin that are the largest cities in Jing-Jin-Ji area by population., Shijiazhuang, Baoding and Tangshan also have significant populations of over 10 million. From an industrial development standpoint, the migration of industries and enterprises into high-tech industrial parks in Jing-Jin-Ji area will generate demand for high-standard warehousing, specialty transportation, and third-party logistics; In terms of the land market availability, Tianjin, Tangshan, Shijiazhuang and Handan have distinct advantages in developing logistics facilities. In the future, more cities in Hebei will become preferred locations for sophisticated logistics occupants.”
September 19, 2018, Beijing – Commercial real estate opportunities will grow materially with improved accessibility and infrastructure in Northern China’s Jing-Jin-Ji area. According to CBRE’s Transformation and Opportunities of Jing-Jin-Ji City Cluster, Series 1: Infrastructure to Accelerate Integration, collaboration between Beijing, Tianjin and Hebei will ultimately open up new channels of commercial real estate demands and create opportunities for both occupiers and investors.
Growth prospects arising from Jing-Jin-Ji’s infrastructural development
The Jing-Jin-Ji urban cluster is comprised of two municipalities (Beijing and Tianjin), 11 prefecture-level cities (including Shijiazhuang, Baoding, etc. in Hebei Province), and the newly established Xiong'an. Accounting for only 2% of the nation’s land area and 6.5% of the total population, the Jing-Jin-Ji cluster contributes to 9% of the national GDP. As the details surrounding the Jing-Jin-Ji cluster’s development plans have materialized, we expect the cluster to overcome obstacles and make breakthrough progress in its infrastructural development, which will mobilize regional integration over the next few years.
Tin Sun, Head of Research, CBRE Northern China, explains:
“Xiong'an, Zhangjiakou, Chengde and Tangshan will be new additions to Beijing’s 1-hour transportation circle; and Shijiazhuang, Xiong'an and Baoding will become new regional transportation hubs, second only to Beijing, Tianjin and Langfang.”
“As new infrastructure and intercity transportation is delivered over the next five years, the cities within Beijing's 1-hour transportation circle will absorb additional demand arising from industrial development. Other cities will mainly rely on the organic growth of their economies to support commercial property demand.”
The Impact of Infrastructure on the Real Estate Market
Office
With a limited supply of office buildings in Beijing’s CBD, certain business functions have been squeezed out of this area. The four major areas around the capital’s half-hour economic circle – Beijing Sub-center, Xiong'an, Tianjin Central City and Tianjin Binhai New Area – will provide the largest concentration of office spaces in the future.
Christina Liu, Regional Managing Director / Executive Director, Advisory & Transaction Services | Office, CBRE Northern China, highlighted: “The office market in each central city will benefit from the development of enhanced transportation measures, which will effectively broaden the geographical area of the central city by pulling areas currently outside of the central city into the same network. Thus, this redefined, expanded central city will be able to meet the additional demand for office spaces. “
Liu continued: “The Beijing Sub-center, centered in the future capital economic circle, will benefit from its geographical location, and in Tianjin, emerging locations near the subway station will bring another wave of supply to the Central City. And, beyond the capital economic circle, Shijiazhuang, Tangshan, Baoding, Langfang and Qinhuangdao are also demonstrating great potential.”
Retail
Due to the functional transformation of Beijing and Tianjin running parallel to evolving consumption patterns, major changes will take place in retail property market.
Zino Helmlinger, Head of Advisory & Transaction Services | Retail, CBRE Northern China, notes “Overall retail property demand will not stagnate; on the contrary, the rapid increase in demand for experience-driven consumption and individualization has broadened the use of retail space, creating demand for prime largescale retail properties. Simultaneously, it is increasingly necessary for retail properties to serve different needs in the market, and place greater emphasis has been placed on positioning and differentiation. Office, residential and tourism are the three most prominent avenues of growth for retail properties in the Jing-Jin-Ji area, especially in core cities.
“The purchasing power of Shijiazhuang and Tangshan is growing, with Langfang, Qinhuangdao and Baoding also showing potential. As an increasing number of domestic and international operators enter the market and local operators upgrade their operation models, these markets will experience increased activity and diversification.”
Industrial
Regional logistics functions will shift out of Beijing; Tianjin and Langfang into Baoding; Shijiazhuang and Tangshan.
Rosemary Li, Head of Advisory & Transaction Services | Industrial, CBRE Northern China, believes, “Developmental prospects will be determined by the land market and the clustering of populations and industries. Tianjin, Langfang, Cangzhou, Beijing, Baoding and Shijiazhuang have the most noticeable advantages in terms of convenience. And, as new infrastructure is gradually implemented over the next few years, Tangshan, Chengde and Hengshui will see greater highway mileage.”
Li added, “Beijing and Tianjin that are the largest cities in Jing-Jin-Ji area by population., Shijiazhuang, Baoding and Tangshan also have significant populations of over 10 million. From an industrial development standpoint, the migration of industries and enterprises into high-tech industrial parks in Jing-Jin-Ji area will generate demand for high-standard warehousing, specialty transportation, and third-party logistics; In terms of the land market availability, Tianjin, Tangshan, Shijiazhuang and Handan have distinct advantages in developing logistics facilities. In the future, more cities in Hebei will become preferred locations for sophisticated logistics occupants.”
Disclaimer:
Neither CBRE nor its affiliated companies make any warranties or claims on the implied accuracy of the information contained herein.
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CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (based on 2018 revenue). The company has more than 90,000 employees (excluding affiliates) and serves real estate investors and occupiers through more than 480 offices (excluding affiliates) worldwide. CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.
