China 14th Five-Year Plan Key Highlights for Real Estate March 2021

 

ECONOMY：

• Enhance the quality and efficiency of the economy via technological innovation and consumption upgrading.
• Reduce the negative list for foreign investment and establish a high-standard free trade zone under the Regional Comprehensive Economic Partnership (RCEP).

 

OFFICE：

• The reduction of the negative investment list and promotion of integration among primary, secondary and tertiary industries will generate strong office upgrading demand from service industries.
• Leasing activity will be led by technology and finance companies, supported by the “dual circulation” policy.
• Ongoing promotion of green technology and financing will stimulate demand for green buildings.

 

RETAIL：

• Tier I and key tier II cities will see growing consumption power resulting from urbanisation and continuous population inflows.
• Demographic change, the accelerated development of new retail formats and faster growth among Chinese brands will initiate re-positioning and tenant mix adjustment in shopping malls.

 

INDUSTRIAL & LOGISTICS：

• New infrastructure will accelerate e-commerce penetration in lower-tier markets, spurring demand for high-standard storage facilities in regional logistics hubs and lower-level logistics nodes. Demand for cold chain facilities will be especially strong.
• Digital transformation and the rapid deployment of 5G will see China emerge as the world's largest data circle.
• The setting up of advanced manufacturing clusters in the eastern region and the Yangtze River Economic Belt will drive demand for industrial real estate such as business parks, R&D facilities, and laboratories.

 

CAPITAL MARKETS:

• The launch of public REITs will spur investment in industrial property.
• Urban renewal will accelerate as the volume of office stock aged 20 years and over will reach just under 25 million sq. m.
• Government policy will support the development of a long-term lease apartment market.