Shenzhen sells five plots at record prices in biggest land tender since 2001 as investors vie for foothold in Greater Bay Area’s tech hub

Logan Property Holdings paid 6.6 billion yuan for the most expensive plot in the Shenzhen tender, while China Overseas Land paid 5.7 billion yuan for the second-costliest plot

The combined area of the five plots add up to 170,273 square metres (1.8 million square feet), slightly smaller than Victoria Park in Hong Kong

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The Shenzhen government is auctioning five residential sites on Monday. Photo: Roy Issa

Zheng Yangpengin BeijingandPearl Liuin Hong Kong

Published: 11:15am, 24 Jun 2019Updated: 11:31pm, 24 Jun 2019

Shenzhen’s government has sold five residential land parcels at record prices, exceeding its minimum bids by 45 per cent, as more than 80 developers from mainland China and Hong Kong jostled for plots

in the technology hub at the centre of the Greater Bay Area megaproject.

The land plots, with a combined area of 170,273 square metres (1.8 million square feet) – slightly smaller than Victoria Park in Hong Kong - sold for a combined 22.38 billion yuan (US$3.2 billion), a record single-day haul for the city government.

Logan Property Holdings paid 6.6 billion yuan for the most expensive plot of land measuring 32,667 square metres, while the Guangzhou city government’s investment arm Yuexiu Property Company paid 5.9 billion yuan for the second-costliest parcel.

The auction is a test of developers’ financial resolve as they bolster their positions in the Greater Bay Area (GBA), which combines 11 southern Chinese cities including Hong Kong into a megapolis with US$1.5 trillion in combined economic output. International capital has poured into real estate in Guangzhou and Shenzhen, two of the most important mainland Chinese cities in the GBA, with 7.5 billion yuan of investments in the first quarter of 2019, topping the 5.2 billion yuan seen in the whole of last year by nearly half, according to data by Cushman & Wakefield.

“Shenzhen occupies the throne [of mainland China’s portion of the Greater Bay Area] and is the hottest city, so every developer is sparing no effort to secure a piece of the action,” said Li Yujia, senior economist with the Real Estate Assessment and Development Research Centre. “No one wants to miss the chance as fewer and fewer land in Shenzhen can be offered for sale on the open market for buildings homes.”