China’s City Winners - JLL City XianProfile... · Xi-Xian New Area Approved by the State Council and established in February 2010, Xi-Xian New Area covers 882 sq ... 6 China’s

WORLD WINNING CITIES | Global Foresight Series 2014

China’s City WinnersXi’an City Profile

2 China’s City Winners

China’s City Winners: Xi’an

Xi’an has an outstanding reputation for the quality and extent of its education and research, the foundations of which were laid in the middle of the twentieth century when, under China’s planned economic regime, the city was chosen as one of two locations (the other being Chongqing) for the development of the country’s aviation industry. As a result, a number of research establishments were set up to serve the industry, which in turn were resourced by graduates from newly-formed academic institutions. This, over time, has contributed to Xi’an’s current position as one of China’s premier education hubs.

With its strategic location as the industrial and financial centre of the Northwest, Xi’an has benefited from China’s renewed efforts to develop the country’s Western region. Massive infrastructure investment, and economic incentives that have lured foreign

manufacturers, have provided a catalyst for economic development in the region and, in particular, the city has made significant efforts to draw international powerhouses - such as Samsung and Bosch - to strengthen its science and technology capabilities. In parallel, the broad presence of multinational corporations (MNCs) and domestic financial and professional services’ firms has grown over recent years, strengthening demand for quality office space. As a result, the majority of higher-quality buildings in the city are close to full occupancy levels.

Xi’an is also north-west China’s primary retail centre, its catchment drawing shoppers from Shaanxi and nearby provinces, including Qinghai, Ningxia and Inner Mongolia, and it is set to continue to grow on the back of favourable demographics and socio-economic factors, such as a large well-educated workforce and an expanding consumer class.

Jones Lang LaSalle’s ViewAs the largest city in north-west China and the capital of Shaanxi Province, Xi’an has been a major beneficiary of central government initiatives to boost Western China’s economic development through its ‘Go West’ policy, which was launched in 2000.

HAINAN

TAIWAN

JILIN

HEILONGJIANG

LIAONINGHEBEI

INNER MONGOLIA

HEBEISHANXI

JIANGSU

ZHEJIANG

FUJIAN

ANHUI

SHAANXI

HUBEI

HENAN

NINGXIAQINGHAI

XINJIANG

TIBET

SICHUAN

GUIZHOU HUNANJIANGXI

GUANGDONGGUANGXIYUNNAN

GANSUSHANDONG

Tier 1 CoreTier 1.5 TransitionalTier 2 GrowthTier 3 Emerging

Suzhou

NingboShanghai

Wuxi

Wuhan

TianjinBeijing

Dalian

Nanjing

Jinan

ShenzhenDongguanGuangzhou

Shenyang

ZhengzhouXi’an

HefeiHangzhou

ChengduChongqing

Changsha

Qingdao

Taipei

MacauHong Kong

Xiamen

Nanning

Kunming

HAINAN

TAIWAN

JILIN

HEILONGJIANG

LIAONINGHEBEI

INNER MONGOLIA

HEBEISHANXI

JIANGSU

ZHEJIANG

FUJIAN

ANHUI

SHAANXI

HUBEI

HENAN

NINGXIAQINGHAI

XINJIANG

TIBET

SICHUAN

GUIZHOU HUNANJIANGXI

GUANGDONGGUANGXIYUNNAN

GANSUSHANDONG

Tier 1 CoreTier 1.5 TransitionalTier 2 GrowthTier 3 Emerging

Suzhou

NingboShanghai

Wuxi

Wuhan

TianjinBeijing

Dalian

Nanjing

Jinan

ShenzhenDongguanGuangzhou

Shenyang

ZhengzhouXi’an

HefeiHangzhou

ChengduChongqing

Changsha

Qingdao

Taipei

MacauHong Kong

Xiamen

Nanning

Kunming

Xi’an City Profile 2014 3

Economic DashboardSizeResident Population (million, 2012) 8.6GDP (RMB billion, 2012) 436.9Employment (million, 2011) 5.0GrowthPopulation (% pa, 2001–2011) 1.3GDP (% , 2011–2012) 11.8InfrastructureRail Passengers (million, 2012) 29.2Freight Traffic (million tons, 2012) 449.2OpennessUtilised FDI (US$ billion, 2012) 2.5Exports (US$ billion, 2012) 7.3WealthGDP/Capita (RMB, 2012) 51,166Disposable Income per Capita (RMB, 2012) 29,982Education and LabourHigher Education Institutions (2012) 62Total Annual Graduates (000s, 2012) 186.4Unemployment (%, 2012) 3.49Average Wage (RMB, 2012) 45,846

Source: Xi’an Municipal Statistics Bureau

Our China50 Research in 2012 identified Xi’an as a ‘Tier 2 Growth’ city with high potential to attain ‘Tier 1.5’ status. A sustainable trend of the development and demand for higher-quality real estate assets is a consistent theme for cities moving from Tier 2 to Tier 1.5 status and, over the course of the next few years, we expect Xi’an to see a steady improvement in the quality of its real estate inventory and an eventual move to the higher status.

We believe that Xi’an’s core competitiveness stems from its strong cultural identity and its prominence as an education and research hub. These characteristics have created a powerful and credible differentiation for the city, and will underpin the ability of Xi’an to develop a more diverse business mix which will progressively support the sustained growth of both its economy and real estate sectors.

Economic & TechnologicalDevelopment ZoneYanliang National Aviation Hi-Tech Industrial Base

Chanba Ecological District

Qujiang New District

Xi-Xian New Area

Hi-Tech IndustriesDevelopment Zone

Xianyang

Xi'an

Weinan

Major Development Zone

Xi-Xian Ring Road (Proposed) Second Outer Ring Road (Proposed)City CentreSecond Ring Road

Yan'an

Yulin

Baoji

HanzhongAnkang

Shangluo

Weinan

Xi'an

TongchuanXianyang

Shaanxi Province

The Greater Xi’an and Major Development Zones

Source: Jones Lang LaSalle Research


commercial centre of the city, housing the People’s Government of Shaanxi Province and some one-third of Xi’an’s prime retail space. Over the past decade, however, limited land availability and the preservation of historical buildings within the walls have constrained development and, as a consequence, pushed economic activity and urban growth to the city’s suburban areas.

At the metropolitan level, we have now begun to see better integration with neighbouring cities, stimulated by a blueprint for a Greater Xi’an Metropolitan area approved by the State Council of the People’s Republic of China in 2010. The planned metropolitan area is composed of the entire administrative districts of Xi’an, together with a couple of surrounding second-tier cities such as Weinan and Xianyang. It is expected to cover about 12,000 sq km and house a total population of 10 million, and will contain new expressways and metro lines to facilitate transportation.

Regional Context and Urban LandscapeNorth-west hub of ChinaXi’an is located in the south-central part of Shaanxi Province, between the Weihe River in the north and Qinling Mountains in the south. It lies at the crossroads of several of China’s main inland arteries, and occupies a key position in the country’s most important east-west trading route which runs from Lianyungang on the Yellow Sea to Kazakhstan via Urumqi - a prominent strategic location that has enabled the city to become the transport hub of north-west China.

Historically, commercial activity in Xi’an was primarily contained within the old city walls, which were rebuilt during the Ming Dynasty (1368-1644) on the remains of the Tang Palace walls. The 12 sq km area bounded by the walls has served as the political and


In the Greater Xi’an metropolis, beyond the city centre that lies within the old city walls, economic activity is being driven by six major specialised development zones:

Zone Description Key Anchors/Industries

Xi’an Hi-Tech Industries Development Zone (Hi-Tech Zone)

Established in 1991, Xi’an Hi-Tech Zone is one of three national-level high-tech industry zones approved by the State Council (the other two are Beijing Zhongguan Technology Park and the Suzhou Hi-tech Park). Located in the south of Greater Xi’an and covering an area of 107 sq km, the zone features electronic information, equipment manufacturing, biological pharmaceutical and automobile industries.

MNCs such as Samsung, Schneider Electric, BYD Auto, Micron, Applied Materials, Honeywell, Intel, IR Semiconductor, Infineon and NEC have all set up production facilities or R&D centres in the zone.

Xi’an Economic and Technological Development Zone

Originally established in September 1993, the State Council classified this zone as a national-level economic and technological development zone in February 2000. The zone has developed facilities catering in particular for the manufacturing side of mechanical, electronic, light industrial and new materials industries, and by end 2015, it is expected the zone to achieve industrial output of RMB 450 billion and industrial added-value of RMB 150 billion.

To date, the zone has attracted more than 3,600 companies, including around 30 ‘Fortune Global 500’ enterprises such as BP and Siemens, many of which are using it as a production base.

Xi’an Yanliang National Aviation Hi-Tech Industrial Base (CAIB – Civil Aviation Industrial Base)

Set up in 2004 by a State Development and Reform Commission, CAIB is the only development zone of its kind in China, integrating aviation industry R&D, training of aviation-related talent, aviation equipment manufacturing and component processing. With more than 300 enterprises, the zone is the largest aviation R&D, training and production base in Asia.

CAIB has attracted investment in its aviation and supporting sectors, such as the RMB 5 billion fund set up by Rose Rock, the Xi’an National Aviation Hi-tech Industrial Base and the Xi’an National Aeronautics Industry Fund Investment Management Company, and the RMB 1.2 billion project jointly developed by the Sichuan Hongtai Industrial Group and the Xi’an Rongda Aviation Company.

Xi’an Chanba Ecological District (CBE) CBE was established in September 2004. It is located in the north-east urban submarket of Xi’an and covers 129 sq km. It is mainly focused on improving the ecology along the Chan and Ba rivers through various ecological and green infrastructure and constructure programmes.

CBE has concentrated on developing the modern services sectors, including finance, tourism, conferences and exhibitions, culture and education.

Qujiang New District Qujiang New District is located in the south-east of Greater Xi’an. It covers a total area of 150 sq km and has some 41 sq km at its core.

The submarket is mainly focused on the culture and tourism sectors, and aims to have 2,000 cultural sector enterprises and an annual output of RMB 30 billion by end 2015.

Xi-Xian New Area Approved by the State Council and established in February 2010, Xi-Xian New Area covers 882 sq km and is an important component in the Greater Xi’an metropolis, located at the centre of the eastern section of the Eurasian Land Bridge and therefore closely linked with other Chinese cities.

The zone is planned to comprise 10 industrial parks, such as the Airport Comprehensive Bonded Zone and Jinghe Trade and Logistics Park.

Average Salaries in Key Cities, 2012

Source: CEIC

Graduates of Higher Education Institutes, 2012

Source: CEIC

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Beijing Shanghai Chengdu Xi'an Chongqing

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Beijing Shanghai Chengdu Xi'an Chongqing RM

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Core StrengthsBest-in-class universities and a large pool of educated workersHigher education in Xi’an has and continues to provide a solid foundation for the development of the city’s high-tech and modern services sectors, with a number of its universities recognised as China’s best. Three universities in the city, namely the Xi’an Jiaotong University, the Northwestern Polytechnical University and the Northwest Agriculture and Forestry University, are on the list of Project 985, which is a national-level scheme that was initiated in 1988 to fund and cultivate the country’s top institutions into world-class universities; the project has 39 sponsored universities which include, among others, Peking University and Tsinghua University. In addition, seven universities in Xi’an are part of Project 211, which aims to raise 100 of the country’s universities to world-class status in the twenty-first century. In terms of the number of universities in Project 985 and Project 211, Xi’an ranks as the top city in Western China.

As the third largest education base in China, universities and colleges in Xi’an annually produce over 186,000 graduates from colleges and universities (ranking only behind Beijing and Wuhan), while its 62 institutions of higher learning are only second in number to Chongqing in the Western China region. In terms of academic qualifications, 22% of Xi’an inhabitants have a college degree or higher, which, nationally, places the city only behind Beijing (32%) and Wuhan (25%), and on the same level as Shanghai. Meanwhile, the percentage of population with a higher education tops other cities in Western China, and is significantly higher than that of Chengdu (17%) and Chongqing (9%).

A young workforce The working-age (15-64) population in Xi’an stands at around 79%, the same percentage as Chengdu but significantly higher than that of Chongqing (71%). The city’s workforce is relatively youthful, with around 45% of the total population aged 15-39, higher than that in either Chengdu (43%) or Chongqing (34%).

Government investment in science and educationAs at end 2011, there were close to 80 scientific research institutes represented in Xi’an, employing more than 35,000 scientists and technical experts; a notable example is the Chinese Academy of Sciences which operates one of its 12 branch offices in the city. Furthermore, many academic institutions in the city have a long history of strategic partnerships with China’s national defence and aviation industries, such as the Xi’an Yanliang National Aviation Hi-Tech Industrial Base (CAIB) which hosts two national engineering research centres that are linked to the Northwest University and Xi’an Jiaotong University. Another example is Northwestern Polytechnical University’s cooperation with the Commercial Aircraft Corporation of China Ltd (COMAC) in using laser solid forming technology as a solution to manufacturing titanium alloy parts for the C919 – the first commercial aircraft designed in China.

Higher Education Institutions, 2012

Source: Municipal Statistics Bureaus

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67

52

62 67

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In its efforts to diversify the city’s economy beyond heavy industry, Xi’an has been encouraging both the development of higher value-added products, such as the manufacture of LEDs and photovoltaic materials, and the expansion of IT outsourcing. In 2012, for example, Xi’an attracted the largest investment by a foreign investor in Western China with Samsung’s pledge to invest US$7 billion in the first phase of a facility to make NAND flash memory drives.

Thriving tourism and cultural industriesAs one of the Four Great Ancient Capitals of China and home to the Terracotta Warriors and Horses, Xi’an is one of China’s most popular tourist destinations and, as such, the tourism industry has been one of the strongest growth areas propelling the development of the city’s tertiary sector. Xi’an has had a continuing programme of investment in tourism, and this has included the accelerated expansion of cultural amenities (e.g. museums, hotels and related infrastructures). As a result, the number of tourist arrivals has grown at an annual rate of over 20% since 2008.

Economic DynamicsStrength in natural resources, heavy industry and manufacturingShaanxi Province is rich in natural resources, such as coal and oil, which are vital ingredients for a range of heavy industries in Xi’an that include steel production, non-ferrous metals, non-metallic minerals, fuel processing, power production and chemicals, and which accounted for about 40% of the city’s total GDP in 2012. The city has retained a historical role as one of the country’s military industrial centres and, as such, the central government has established a number of associated state-owned factories, such as Xi’an Coal Mining Machinery Company and Xi’an Steel.

The five pillar industries in Xi’an are high-technology, equipment manufacturing, tourism, modern services and culture; the value added by these dominant industries accounted for about 51% of Xi’an’s GDP in 2012, increasing from 40.8% in 2005. Of these industries, the modern services sector contributed around one-third of the city’s GDP in 2012.


GDP in Key Cities, 2012

Source: CEIC; Municipal Statistics Bureaus

15.5% 17.7% 17.3% 17.9%

0%

4%

8%

12%

16%

20%

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1,500

2,000

2,500


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13.2%

Freight Traffic, 2012

Source: CEIC

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396 449

1,101

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Freight Traffic (LHS) Y-o-Y Growth (RHS)

Policies and investment in Guanzhong-Tianshui Economic Zone to drive future growthApproved by the State Council in 2009, the Guanzhong-Tianshui Economic Zone, with an area of 79,800 sq km, covers Xi’an and other cities such as Tongchuan, Baoji and Xianyang in Shaanxi Province and Tianshui in Gansu. Under the current plan for the zone, Xi’an will specialise in high-value-added industries such as aeronautics and aviation, equipment manufacturing, culture, tourism and modern services, while other cities will focus on sectors such as food processing, electronic appliances and modern agriculture. The plan also includes major investments in infrastructure, including railways and expressways which, in its capacity as the official centre for the zone, will enhance accessibility to and from Xi’an.

Business-friendly policiesXi’an enjoys preferential policies from both central and local government in regards to stimulating foreign investment and nurturing key growth industries, such as high-tech outsourcing and modern services. Various policies - including income tax reductions and exemptions, input (e.g. water, electricity) subsidies, and land-use fee waivers - are being used to encourage foreign investment as well as domestic high-value-added enterprises. For example, in the Hi-Tech Zone the tax rate has been cut to 15% for foreign-invested high-tech companies and to 24% for manufacturing companies who have been operating for more than 10 years.

On a municipal level, Xi’an currently offers a range of generous incentives to various enterprises - including those in modern services, financial services and logistics – and, in addition, each development zone provides priority support to its favoured industries. For example, Qujiang New District gives cultural corporations that meet its requirements a range of policy incentives, including income tax reductions. Elsewhere, Chanba Ecological District, in aiming to cultivate a financial and business zone, is providing preferential policies to companies in the financial services, modern services and environmental protection sectors.

These policies have successfully stimulated economic growth, with the actual utilised FDI amounting to US$2.5 billion in 2012 in Xi’an, up 23.6% year-on-year. As of end 2012, there were some 3,000 projects in the city involving investment by foreign MNCs - among these are 136 branches set up by 85 ‘Fortune Global 500’ companies. These include, many high-tech heavyweights, such as IBM, Intel and Huawei, and notable newcomers like Samsung - whose US$ 7 billion investment, as previously mentioned, shows that major companies are continuing to invest heavily in the city.

Zhouzhi HuxianChang’an

Lantian

Yanta

Baqiao

Lintong

Yanliang

Gaoling

Weiyang

XinchengLianhu

Beilin

Administrative Districts in Xi’an



Xi’an Demographics, 2011

District Area (sq km) Population Density

(persons/sq km)

Core

Xincheng 30 592,300 19,743

Beilin 24 618,700 25,779

Lianhu 43 701,300 16,309

Yanta 149 1,114,800 7,952

Weiyang 262 811,400 3,097

Baqiao 325 598,700 1,842

Chang'an 1,590 1,090,100 686

Yanliang 244 280,100 1,148

Lintong 915 659,800 721

Suburban/Periphery

Lantian 2,008 516,500 257

Zhouzhi 2,949 565,900 192

Huxian 1,282 558,500 436

Gaoling 287 335,300 1,168

Source: Xi’an Municipal Statistics Bureau

Population of Key Cities, 2012

Source: Municipal Statistics Bureaus

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Beijing Shanghai Chengdu Xi'an Chongqing Wuhan

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DemographicsAs at end 2012, the total population of Xi’an was approximately 8.5 million, making it the most populous city in Shaanxi Province and third (behind Chongqing and Chengdu) among the major cities in Western China. Around 80% of the population live in the city’s nine urban districts, the most populated of which are Yanta and Chang’an while Beilin has the highest density.


Planning and Infrastructure

Largest air hub in north-west ChinaPositioned as the aviation hub of the region, Xi’an Xianyang International Airport - which is located in Xianyang City, some 41 km north-west of Xi’an city centre - has undergone a rapid expansion, making it the largest and busiest airport in north-west China. The newly-completed Terminal 3 and the second runway have increased the airport’s capacity to more than 33 million passengers per year.

In 2012, the airport handled 23.4 million passengers, making it the eighth busiest airport nationwide. It already has flight routes to major destinations such as Seoul, Tokyo, Singapore, London, Paris, Frankfurt, Los Angeles, Bangkok and Kuala Lumpur, and in 2013 the airport opened additional routes to Helsinki and Moscow, reinforcing its position as the region’s air hub. By 2015, the airport is expected to link to more than 90 cities globally via some 200 routes, and passenger throughput is projected to exceed 30 million.

Enhanced railway facilities and expressway linksXi’an is the largest railway hub in north-west China, linked to the national high-speed railway network through the Xi’an-Zhengzhou High-Speed Railway which began operations in 2010. Further high-speed railway lines, such as the Xi’an-Chengdu and Xi’an-Wuhan lines, are under construction or in planning.

Xi’an’s government has also invested in new transportation facilities, including a new railway station and further extensions to the existing railway network. On completion, the new Xi’an North Railway Station will be the largest railway station in Asia. It is being developed in two phases, and will have a final total GFA of 171,000 sq m. Phase one, containing 15 platforms, started operations in January 2011. When Phase Two is completed in 2018, the station and its 34 platforms will have an annual throughput of 82 million passengers.

China’s Busiest Airports – Total Passengers, 2012

Source: Civil Aviation Administration of China

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China’s High-Speed Railway


Longhai Railway (Freight rail)

Xi’an Zhengzhou LianyungangQingdao

Shanghai

Beijing

Chengdu Wuhan

GuangzhouShenzhen

Lanzhou

Xi’an-ZhengzhouXi’an-ChengduXi’an-Wuhan

High-speed railway system


By road, Xi’an is linked to other provincial cities through nine national expressways, an arterial framework that has enabled the city to form an established expressway system of more than 2,800 km that connects the whole of Shaanxi Province and its surrounding provinces. There are six national highway routes passing through this city, such as China national highway 211 (G211) running from Yinchuan in Ningxia to Xi’an in Shaanxi, and China national highway 210 (G210) from Baotou, Inner Mongolia to Nanning, Guangxi Province. Within the metropolitan area, the Outer Ring Road, a new highway to the Xi’an Xianyang International Airport, the 2nd Ring Road and the 3rd Ring Road are now in full operation, and the

city has also completed and opened numerous other highways to districts and counties under its jurisdiction.

Xi’an is continuing to rapidly develop the expressway system, with current major roads under construction including the Second Outer Ring Road and the expanded national highway 321 (G321) which runs from Lianyugang in Jiangsu Province to Khorgas in Xinjiang Uyghur Autonomous Region. The improved highway system has, as a result, enhanced the city’s position as the centre for the Guangzhong-Tianshui Economic Zone, even to the extent of it now being a major gateway to Eurasian markets.

Line 11 Line 15

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In operationPlanned

Line 4

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Ambitious metro system expansionThere are two operational metro lines in Xi’an: Metro Line 2, with a total length of 20.5 km, which came into service in 2011, and Metro Line 1 (25.4 km), completed in 2013. The Xi’an Metro is the only metro system in north-west China and has an average daily passenger flow of approximately 500,000. In expanding the

system, an ambitious metro plan is underway with additional lines – namely Lines 3 and 4 and the Line 2 extension – currently under construction. Together with the planned Lines 5, 6 and 11, the Xi’an Metro will eventually have seven lines with a total length of 221 km by end 2018. In the longer term, by 2030, the city will have 15 metro lines with a total length of about 600 km.

The Xi’an Metro – Operatonal and Planned Lines



Major EmployersChina National Software & Service/HuaweiChina National Software & Service Co Ltd and Huawei have set up a joint venture in the Hi-Tech Zone. The company has over 15,000 employees (2012), and its annual revenue is forecast to reach RMB 3.6 billion (US$590 million) in 2015.Shaanxi Automobile GroupHeadquartered in Xi’an, Shaanxi Automobile Group was established in 1968 and has now grown into a company that has over 35,000 employees (2012) and 20 subsidiaries, which include the Xi’an Cummins Engine Company.Xi’an-Janssen PharmaceuticalXi’an-Janssen is a joint venture that was set up in 1985 by the Belgium-based Janssen Pharmaceutical Company, the Shaanxi Pharmaceutical Group, the Shaanxi Hanjiang Pharmaceutical Company, the China National Pharmaceutical Industry Corporation and Sino Pharm. It is now a Johnson & Johnson company and the largest joint venture pharmaceutical company in China. Headquartered in Beijing and with over 3,000 employees in China, the company has a manufacturing base in Xi’an.BYD Xi’an AutoThe first BYD factory, with an annual production capacity of 100,000 automobiles, was built in the Hi-Tech Zone in 2003 and the company’s second Xi’an facility, with an annual output of 400,000 units, was completed in 2013. The two facilities have a combined annual capacity of 700,000 automobiles, projected total annual sales revenue of RMB 35 billion and a workforce of 70,000 employees (2013).Minsheng Department StoreThe Minsheng Department Store was established in 1959 and became a public company in January 1994 - one of the earliest companies to become listed in Xi’an and north-west China. The company operates department stores and supermarkets, employs over 5,000 (at end 2013), has total assets of RMB 1.1 billion and annual sales revenue of more than RMB 2 billion.Ginwa Enterprise GroupFounded in 1991, Ginwa Enterprise Group has been developed into a large conglomerate with diverse interests in real estate investment, pharmaceutical manufacturing, department stores and hotels. By end 2013, the group owned two listed companies employed more than 20,000 staffs, and had total assets valued at about RMB 30 billion.

Samsung ElectronicsIn the first phase of an investment project that will total US$7 billion, South Korea’s Samsung Electronics is setting up a flash memory R&D and manufacturing facility for Xi’an in what is the largest foreign invested high-tech industry project since the implementation of the central government’s ‘Reform and Opening Up’ policy. Phase 1 of the project became operational in 2013.Schneider ElectricIn November 2011, Schneider Electric signed an agreement with the Xi’an Hi-Tech Zone which signalled an investment by the company of US$200 million (RMB 1.22 billion) in the development of several projects, including its Innovative Software R&D Centre and the Industry Applied Equipment Centre, as well as its Western China headquarters. The R&D Centre and factories were completed at the end of October and November 2013, respectively.SchlumbergerSCP Oilfield Services, a joint venture between Schlumberger and CoPower, signed an agreement with the Hi-Tech Zone in January 2013 that will see the company establish its headquarters as well as a production dispatching centre, a financial settlement centre and a technology R&D centre within the zone. The investment will total RMB 630 million (US$102.9 million).Rose Rock GroupIn November 2012, the US-based Rose Rock Group established a RMB 5 billion fund with the Xi’an National Aviation Hi-Tech Industrial Base and the Xi’an National Aviation Industry Fund Investment Management Company to jointly develop a 20 sq km international aviation industrial city.Global Logistic Properties (GLP)A joint venture set up by GLP and the Xi’an Hi-Tech Zone, which involves a total investment of RMB 2 billion, is developing the GLP I-Park. Located inside the R&D area of Xi’an Software New City, the park will have a site area of 223 mu* (148,667 sq m) and a GFA of 550,000 sq m.IKEASweden’s IKEA group has confirmed that it will build its first outlet and distribution services centre in north-west China in Fengdong New Town in the Xi-Xian New Area, an investment of €100 million (RMB 805.8 million).Suning Group In August 2012, Suning Group purchased a circa 8,500 sq m (site area) plot in the City Centre for RMB 19.59 million per mu* (accommodation value) and is investing a total of RMB 800 million in its first commercial real estate development in north-west China. The scheme is scheduled to be completed in early 2014.GoodmanGoodman will develop a modern e-commerce industrial park in the Xi’an Economic and Technological Development Zone. With a total investment of US$60 million, the project will have a GFA of about 100,000 sq m and will start operation in 2015.* 1 mu = 0.06667 hectare

Major Investments


Real Estate OverviewReal Estate Dashboard, Q4 2013

Market Size

Total Office Stock (000s sq m) 2,024

Grade A (000s sq m) 603

Grade B (000s sq m) 1,421

Total Retail Stock (000s sq m) 3,211

High-End Residential (Units) 60,000

Number of Hotels (Five-star) 9

Market Activity

Office Vacancy Grade A (%) 22.0

Retail Vacancy (%) 4.2

Benchmark Values

Grade A Office Rents (RMB/sq m/month) 106

Retail Rents (RMB/sq m/month) 202

High-End Residential Capital Values (RMB/sq m) 10,600

Grade A Office Indicative Yields (%) 8.0


Key Players

Investors

Residential China Overseas, Vanke, Ziwei, Gemdale, Kingfar

Offices Greenland, CapitaMalls Asia, Maike Holding, Linnking Group

Logistics GLP, China Merchants Logistics, Mapletree, Shaanxi Shang Chu Wu Liu

Hotels Shangri-La, Sheraton, Crowne Plaza, Starwood, Sofitel

Retail Century Ginwa, Wanda, Intime, Mapletree, Greenland

Occupiers

Retail LV, H&M, Zara, Gap, C&A, Ole’

Service Firms Jones Lang LaSalle, PwC

Consulates Thailand, South Korea


Key Transactions

InvestorsChina Electronics Corporation purchased Taihua•Jinmao International Block 4 in the High-Tech Zone

China Minsheng Bank purchased Taihua•Jinmao International Block 5 in the High-Tech Zone

SPD Bank purchased a 15,000 sq m property at Greenland Zhihai Plaza in the High-Tech Zone

Chang’an Bank purchased a 35,000 sq m property at Langchen Plaza in the High-Tech Zone

Western Investment Group purchased a 1,400 sq m office at Chang’an Metropolis Center in the City Centre

Anbang Insurance bought 1,200 sq m office in the High-Tech International Business Centre in the Hi-Tech Zone

Occupiers

HP leased about 1,000 sq m in Linnking International Building in Q1 2012

PwC leased 2,300 sq m in Chang'an Metropolis center in Q1 2012

Canon leased 700 sq m in Chang'an Metropolis center in Q2 2012

Bayer leased 900 sq m in Chang'an Metropolis center in Q2 2012



Offices

As with other major cities in the region, Xi’an’s occupier market is largely dominated by local players, with large state-owned enterprises (SOEs) as well as domestic companies being the key drivers of demand in the quality office market. As most MNCs within the city are still in the early stages of their business operations, they are, so far, only playing a minor role in the city’s occupier market, with average space requirements of about 200 sq m, which is lower than its counterparts such as Chengdu (c. 500 sq m) and Chongqing (c. 400 sq m).

Total occupied institutional grade stock (Grade A and B) relative to its service sector output remains below other Tier 1.5 and Tier 2 cities. However, given the industry dynamics in Xi’an, we do not think that the low ratio necessarily suggests a massive undersupply of office stock, as a significant volume of demand from the tertiary sector is being met by office space available in the city’s established research and science parks.

Even so, we believe the market contains a large potential pool of demand for upgrades. Similar to their peers in other cities across China, we expect occupiers in Xi’an to increasingly demand higher-quality office space, and this is being made evident by a fairly strong take-up of higher specification buildings in prime locations by MNCs and domestic companies.

As a result, we expect that the prevailing divergence in real estate activity between prime and secondary locations will persist. Despite the apparent high vacancy rates in the overall market, the availability of high-quality offices in prime locations, such as the City Centre and northern end of the Hi-Tech Zone, remains limited. On the other hand, the high level of supply in secondary locations will continue to put pressure on the rental and price levels of buildings in those areas.

Retail

Sustained by shoppers from not only Shaanxi but also other provinces in north-west China, such as Qinghai, Ningxia, Gansu and Inner Mongolia, Xi’an is witnessing a booming retail market that has led to the city becoming the commercial centre of the region.

Although Xi’an is home to a number of international luxury brands, such as Louis Vuitton, Gucci and Prada, the depth and diversity of brands in the city has thus far lagged its Western region peers, namely Chengdu and Chongqing. This, combined with increasingly favourable demographics, has made Xi’an a ripe and attractive destination for retailer expansion in China.

Local players, such as Century Ginwa and Minsheng Department Store, have led and continue to dominate the market. However, there are now a number of projects in the supply pipeline being developed by reputable domestic shopping-mall developers, such as Wanda, China Resources Land and Chia Tai Group, each of which are introducing new elements such as ‘experience-led retail’ to the city.

Like many other cities in China, Xi’an is seeing growing volumes of new supply, with total stock rising from 3.2 million sq m at end 2013 to a projected 5.8 million sq m in 2016. The City Centre and Hi-Tech Zone are currently the most established high-end retail clusters in Xi’an, with most high-end department stores and shopping malls concentrated in these submarkets. However, with an expanding metro system and further improvements in transportation across the city, many of the new districts, such as City North and the southern part of the Hi-Tech Zone, have the potential to attract prime retail precincts.

Jones Lang LaSalle’s View


Industrial

Traditionally, Xi’an has relied on heavy industry, particularly its automobile and aviation-equipment manufacturing sectors, through an economic development programme strategically cultivated by the central government. However, the strong supply of skilled labour and active support from the Xi’an government has encouraged the broadening of the industrial base, and the growth of the high-tech industry in particular over the recent decade. As a result, a number of technology giants such as IBM, Intel and Huawei have established large-scale manufacturing or R&D bases in the city and, with robust demand and limited supply, the majority of the buildings in business parks are now at full occupancy.

Also under provisioned within the city is international logistics (warehouse) stock. Driven by an ever stronger manufacturing production base, an established transportation network and robust domestic consumption, there is heavy demand for a greater volume of high-quality logistics warehousing.

Given the Xi’an government’s more accommodating view on the industrial sector, we therefore expect a significant increase in activities in the business park and logistics sectors. The city government has realised that a shortage of high-quality space in these sectors will hinder the long-term development of the city’s economy, and therefore has long-term plans to expand the scale of the existing Hi-Tech Zone, Xi’an Economic and Technological Development Zone and Xi’an International Trade and Logistics Park.

Residential

As the established economic and education focal point of north-west China, Xi’an is experiencing buoyant demand for high-end residences from a growing volume of affluent inhabitants within the region. At the same time, the city’s expanding white-collar population - a result of its flourishing high-tech and financial services industries - is also fueling a healthy demand for housing. We expect that these two forces will continue to sustain the high-end residential market in Xi’an.

Furthermore, the government’s economic development direction, together with improvements in the transport network within the city, will see the distribution of high-end residential clusters expand from the existing City Centre, Hi-Tech Zone and Qujiang to City North and City East.

We expect the average quality of high-end residential housing in Xi’an to be enhanced with the entry of prominent developers - particularly domestic giants such as Greenland Group, China Overseas and China Resources Land - who will introduce fresher elements and concepts essential to the high-end residential market.

Hotels

As one of China’s earliest well-developed tourism cities, Xi’an has the highest presence of international hotel brands within north-west China, having attracted a number of renowned operators such as Hilton, Sofitel and Sheraton to provide world-class hospitality services.

The city expects to see another 2,700 international branded rooms added to its hotel supply over the next three years, increasing by 20% compared with end-2013 stock levels. Although this expansion will put pressure on hotel room occupancy rates in the short term, the rapid development of corporate business, the MICE (Meeting, Incentive, Conference and Exhibition) sector and domestic tourism will generate additional demand, limiting any sudden fall in room rates.


OfficesTotal quality office stock in Xi’an was 2 million sq m at end 2013, composed of 0.6 million sq m of Grade A and 1.4 million sq m of Grade B space. There are three major office submarkets in the city – the City Centre, the Hi-Tech Zone and City North – and within these areas it is local players that have developed most of the existing office buildings, with only a few office schemes involving wider domestic and foreign concerns. However, the city’s office market is undergoing significant change, with many national and international developers, such as Greenland, China Railway Construction and CapitaMalls Asia, having office projects scheduled to be completed in 2014-2018 that will help to enhance the overall quality and specification of commercial space within the city.

From an occupier perspective, the Xi’an office market is dominated by domestic companies, which account for around 85% of the occupied space. Foreign MNCs, who tend to have higher technical requirements for office space, are primarily clustered in a handful of Grade A office buildings, such as HSBC and Bank of East Asia in Chang’an Metropolis Center in the City Centre; Texas Instruments and Rohm Semiconductor in the High-tech International Business Centre; and Davis Langdon and Jones Lang LaSalle in CapitaMall Office in the Hi-Tech Zone.

As at end 2013, the overall office vacancy rate for Xi’an stood at around 21%; Grade A vacancy at 22% and Grade B at 20%. Sustained by strong demand from foreign MNCs and local enterprises, most prime office buildings in the well-established office clusters, such as the City Centre and the northern part of Hi-Tech Zone, have achieved full occupancy levels. Meanwhile, most of the city’s vacant office space can be found in new projects in emerging areas such as the southern part of the Hi-Tech Zone and the northern part of the City North. Nevertheless, it is expected that the high vacancy levels in these emerging office clusters will be relieved once the city’s long-term economic development direction takes effect. Furthermore, the improvement in infrastructure - such as in the metro and expressway systems - together with the relocation of the Xi’an Municipal Government headquarters to City North, will also trigger other office occupiers to relocate to these new clusters.

Submarket Description

City Centre A traditional submarket with comprehensive amenities and good accessibility, this is the area most preferred by MNCs. Notable office developments include Chang’an Metropolis Center (Grade A) and New Times Square (Grade B). Future office supply is limited in the submarket due to insufficient land supply.

Hi-Tech Zone

The northern part of the Hi-Tech Zone is an established office cluster. High-quality office buildings are mainly along Tangyan Road and Keji Road with notable office developments including the High-tech International Business Centre (Grade A), Linnking Plaza (Grade A) and CAAC Tangyan International Center (Grade B).

The southern part of the Hi-Tech Zone is an emerging cluster with healthy levels of future supply. A growing number of SOEs and MNCs are being attracted to this submarket.

City North City North is another emerging office submarket, which consists of the existing office buildings and upcoming office projects located along Weiyang Road. Major office buildings include Changqing Technology Building (Grade A) and Jingfa Plaza (Grade B). Stimulated by the relocation of the Xi’an Municipal Government, office developments in City North have been accelerated. The new developments are mainly concentrated in the northern section of Weiyang Road.

Looking ahead, the Hi-Tech Zone and the City North submarkets, which have the highest concentrations of existing and future supply, will develop into the major office clusters in Xi’an. The maturing business environment, improving infrastructure and accessibility will help to attract more tenants to these submarkets, as too will the growing industrial concentration in the Hi-Tech Zone which will generate further demand for office space. Moreover, continued subsidies and tax waivers from the local government will further entice greater numbers of companies to move to these emerging clusters.


Grade A Office Stock and Vacancy, 2012 and 2013


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RetailAs at end 2013, Xi’an’s volume of prime retail space stood at some 3.2 million sq m – 1.5 million sq m in shopping malls and 1.7 million sq m in department stores. The City Centre is the most established prime retail submarket in Xi’an, with its wide selection of retail centres and department stores drawing shoppers from all over the city as well as from the wider Shaanxi Province. At the same time, tourist attractions within the City Centre, such as the Bell Tower, the Drum Tower and Muslim Street, have all helped to bring plentiful number of visitors to the submarket. Zhongda International Mall in the City Centre is Xi’an’s most high-end shopping mall, home to luxury brands such as Louis Vuitton, Prada and Versace. The other major retail submarkets are Xiaozhai and the Hi-Tech Zone, where many mid- to high-end department stores and shopping malls can be found; notable examples include CapitaMall-Xindicheng and Century Ginwa-High-tech Store. In contrast to the City Centre, these submarkets are mainly supported by their local communities.

Prime Retail Stock and Vacancy, 2012 and 2013


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After experiencing five years of rapid growth (15% CAGR), the city annual retail sales reached RMB 223.6 billion in 2012, ranking only behind Chengdu and Chongqing in Western China. This rapid growth has been largely underpinned by an increase in household incomes and the burgeoning tourism sector - per capita disposable real income for Xi’an has maintained double-digit annual growth since 2008, almost doubling from RMB 15,207 in 2008 to RMB 29,982 in 2012.

These favourable fundamentals and greater supply options have encouraged retailers to expand in the market. In particular, fast-fashion brands such as Gap, H&M and Uniqlo have already opened stores in the city’s new shopping malls and department stores, and the rising number of new set-up requirements is a major demand source for prime retail space. At the luxury end of the market, brands such as Lanvin, Tiffany & Co. and Roger Vivier have recently entered Xi’an.

Total prime retail stock is forecast to almost double in the next three years, reaching 5.8 million sq m by end 2016, while malls are expected to replace department stores as the key component in the city’s prime retail market. Experienced shopping mall developers, such as China Resources Land, Wanda Group and CapitaMalls Asia, will continue to increase their investment in the city on the back of the forecast for fast-growing momentum in Western China’s regional economy.


ResidentialLocal and other domestic developers dominate the Xi’an high-end residential market, with China Overseas, Greenland and Gaoke Group representing the leading developers in the city. Foreign developers are not involved in any high-end residential schemes, however a few do have commodity housing projects in the city; notable examples include Hutchison Whampoa, which has developed Yicui Garden in the Hi-Tech Zone, and Henderson Land and Surbana Land, which have jointly developed La Botanica in Chanba Ecological District.

At end 2013, there were about 60,000 high-end residential units in Xi’an, primarily located in the City Centre, Hi-Tech Zone and Qujiang submarkets.

• The City Centre is the oldest high-end residential submarket, its projects being originally initiated by local and domestic developers in 2003. Its established business environment, together with good accessibility, means that it has traditionally been regarded as a high-end residential cluster and, at end 2013, the total stock of

high-end units was about 15,200. Among these, properties include China Overseas’ Classic Palais and Shanghai Eastern Airlines Real Estate Investment’s Gongyuan Tianxia.

• Qujiang is currently the largest high-end residential submarket in the city with a total stock of around 22,000 units (end 2013). The development of this submarket began in 2003 when Qujiang was designated as one of the two earliest National Cultural Industry Demonstration Bases by the central government. Within Qujiang, China Overseas’ Gemlacus and Gemdale’s Lake City are the most expensive luxury residential estates to have been developed in the city thus far.

• The Hi-Tech Zone houses another important cluster of high-end residential projects. An influx of MNCs from the high-tech sector in the 2000s triggered the accelerated development of both high-end and mass residential properties, pushing the total stock of high-end residential in the submarket at end 2013 to about 16,000 units. The favourable fundamentals within the zone have attracted many well-known local developers, such as Gaoxin and Ziwei, to provide high-quality accommodation for the district’s workforce.


Overall demand for high-end residential properties in the city has been robust in recent years, with the rapid pace of economic growth since the implementation of the ‘Go West’ policy in 2000 creating a large, high-income population that can sustain the market. As the income level of workers employed in the high-tech and financial services sectors are among the highest, most high-end housing has gravitated closer to established office precincts. Similar to other provincial capital cities in China, Xi’an has the greatest regional catchment area within Shaanxi Province and this includes affluent households from resource-rich second-tier cities and counties, such as Yan’an and Yulin, who are also keen on purchasing residential units in Xi’an. Their preference is for high-end residential properties to the south of the city, particularly Qujiang, as most of the projects in this submarket take advantage of amenities such as South Lake and Tang Paradise.

Looking ahead, high levels of congestion and limited land supply in the City Centre have and will continue to result in housing demand spilling over to other submarkets. Much of the new supply and demand for housing has coincided with the extension of the transportation network and the government’s economic development direction. Over time, City North and City East, traditionally areas that are more oriented towards commodity housing, will also evolve

to capture a larger share of high-end residential developments. Many experienced developers, such as Greenland Group, Vanke and Longfor Properties, are already developing high-end residential projects in these submarkets, and we expect these and others to raise overall standards and provide competitive alternatives to satisfy the growing demand for high-quality accommodation in Xi’an.

Xi’an High-End Residential Stock, 2010-2016


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Business and Logistics ParksBusiness Parks

Xi’an’s current business park stock is only 700,000 sq m and, as a result, overall occupancy is almost 100%. Most of the business park space (around 90%) is located in the Hi-Tech Zone, its notable projects including Xi’an Software Park and the Ascendas Innovation Hub. After more than a decade of development, a number of software and high-tech outsourcing services companies, including IBM, Sybase, Oracle, Emerson and Rockwell, now have large-scale R&D and production bases in the zone.

In order to fulfil growing corporate expansion requirements, the Hi-Tech Zone has an extension plan for a section of the Xi’an Software New City business park. Located in the south of the Hi-Tech Zone, the park is being developed in several phases; the planning area for the first phase is about 2 million sq m and comprises a number of high-profile projects such as Xi’an GLP I-Park and ChinaSoft International’s Ten-Thousand-Staff Base. These projects are scheduled for completion in 2014-2015 and will further strengthen Xi’an’s leading position as the high-tech industry hub for Western China.


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Major Business Park and Logistics Clusters in Xi’an

Logistics Parks

As a key transportation hub and high-tech production base in Western China, the logistics warehouse market in Xi’an has grown rapidly in recent years. There are three major bonded logistics zones in the city - namely Xi’an-Xianyang Airport Bonded Logistics Park, Lintong Modern Logistics Park and Xi’an International Trade and Logistics Park - and each is well-connected to the city’s transport infrastructure, including the airport and its railways.

The majority of international-grade non-bonded warehouse projects are located in the Hi-Tech Zone and Xi’an Economic and Technological Development Zone, and a growing number of schemes involve well-known logistics warehouse developers that

have already entered the market, such as Shangchu Logistics, Zhongchu Logistics, Kerry EAS, Mapletree and GLP. Supported by strong demand from the manufacturing sector, retailers and e-commerce suppliers, the vacancy rate of the non-bonded logistics warehouse market was around 8% at end 2013.

A modern logistics sector is one of the key development directions in the Xi’an 12th Five-Year Plan and, as such, the government plans to cultivate more logistics enterprises as well as to construct six to eight new logistics parks. A number of successfully delivered long-term blueprints will consolidate the strength of Xi’an as the primary logistics hub in Western China, and cause both domestic and foreign logistics developers to increase their investment in the city.


HotelsWith more than 3,000 years of history, including 1,100 years as one of the Four Great Ancient Capitals of China, and its worldwide fame as one of four major ancient capitals of civilisation (alongside Athens, Cairo and Rome), Xi’an has a wealth of historical and cultural heritage assets such as the Terracotta Warriors and Horses, Huaqing Pool and Big Wild Goose Pagoda. These sites have consistently attracted millions of tourists to Xi’an every year and, as a result, Xi’an’s tourism and hotel market has witnessed sustained, impressive growth over a number of years.

Tourism is therefore one of the pillar industries of Xi’an’s economy and, unsurprisingly, ranks top among tourist sectors across all the major cities in north-west China, with total domestic tourist arrivals in Xi’an reaching 78.6 million in 2012, a 20% increase over the previous year and a CAGR of 19.5% from 2008 to 2012. Meanwhile, international arrivals reached 1.2 million in 2012, a 15.1% year-on-year growth over 2011. In terms of the origin of international tourists, the US is the largest market, followed by Japan, Korea, the UK and France.

Along with expanding tourist demand, the recent rise of the MICE (Meeting, Incentive, Conference and Exhibition) industry has also provided further robust demand for quality hotels in the city. By November 2012, 154 major conferences and events had been hosted in Xi’an and, according to the China Conference and Exhibition Research Centre, 88 intra-city meetings and conventions were held in Xi’an in 2012 alone, which ranked sixth after Beijing, Shanghai, Guangzhou, Chengdu and Nanjing among all mainland cities. Moreover, the Xi’an Annual Statistical Bulletin reveals that 22 international and national sports events have been hosted in the city, and it has even become a permanent site for certain events, such as the Eurasia Forum and the International Horticultural Exposition. According to the 12th Five-Year Plan, Xi’an will be developed as

a regional international meeting and exhibition centre, and this will expedite the long-term growth of hotel demand in the city.

The extensive presence of quality hotels has consolidated Xi’an’s position as one of the most important tourism and exhibition hubs in the region. According to the Xi’an Tourism Bureau, as at end March 2013 there were 121 star-rated hotels in the city - including 9 five-star, 27 four-star, 76 three-star and 9 two-star - providing a total of 23,199 guest rooms. Among these are international hotel brands, such as Hilton, Sofitel, Sheraton, Crowne Plaza and Shangri-La, who are already well-established in the city; Jones Lang LaSalle Hotels Research forecasts there are around 2,700 international-brand hotel rooms scheduled for supply over the coming three years.

With the opening of more international-brand luxury hotels and the continuous growth of leisure, corporate and MICE demand, the average daily rate of hotels is expected to grow further in the mid to long term. However, occupancy levels might increase at a more moderate pace, as the market will need a certain period to absorb the additional hotel supply.

Major International Brand Hotel Supply, 2009-2016 F

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Definition of TermsEconomic Dashboard

Population: Population refers to the total population as at or near year-end 2012. There are two definitions of population: • Registered population – those officially registered with the police. • Permanent residence population – those who actually reside permanently

in a location, usually longer than one-half year.Xi’an’s population refers to permanent residence population, as determined by Xi’an Municipal Statistics Bureau.

GDP: Refers to the gross domestic (i.e. regional) product of a location.

Employment: Refers to the number of persons engaged in labour and receiving remuneration payment or earning business income, including fully-employed staff and workers in state-owned, collective-owned, privately owned or other kinds of economic sectors and otherwise employed persons.

Population Growth: Refers to the compound annual growth rate over the 10-year period 2001–2011.

GDP Growth: Refers to the compound annual GDP growth rate from 2011 to 2012.

Rail Passengers: Refers to the number of passengers travelling through a city by railway, as determined by number of tickets sold.

Freight Traffic: Refers to the volume of freight transported by various means, measured in millions of tons.

Utilised FDI: Refers to remittance, equipment and technology financed from abroad, by loans, foreign direct investment (FDI) and other forms undertaken by the Chinese government at all levels, by various departments, enterprises and other economic units.

Exports: Refers to value of exports of trade companies registered in Xi’an.

GDP/Capita: Refers to total gross domestic product divided by the resident population.

Disposable Income/Capita: Refers to the actual income at the disposal of a person which can be used for daily expenses, i.e. total income minus income tax, property tax and other current transfers.

Higher Education Institutions: Refers to higher education institutions providing higher education courses and training for professionals. They include full-time universities, colleges, high professional schools, high professional vocational schools and others. Higher education institutions are set up according to the central government’s evaluation and approval procedures. This category may also include some adult education institutions.

Total Annual Graduates: Refers to the total number of students graduating with degrees from a higher education institution in a given area.

Unemployment Rate: The registered urban unemployment rate refers to the ratio of the number of the registered unemployed to the sum of the number of persons employed in a location.

Average Wage Rates: Average wage rate refers to the average wage of fully-employed staff and workers. It is calculated as follows: average wage of fully employed staff and workers = total wages of fully-employed staff and workers/average number of fully-employed staff and workers.

Currency: Monetary values are expressed in the currency reported (either RMB or US$), with the other currency in parenthesis and calculated with the year-end 2013 exchange rate of 6.0533 RMB/US$.

Real Estate Dashboard

Offices Grade A Stock: Refers to the total completed Grade A office space (occupied and vacant). Grade A properties are generally wholly owned and have an above-average condition and amenities suitable for MNC tenants.

Offices Grade B Stock: Refers to total completed Grade B office space (occupied and vacant). Grade B reflects a middle-range property in the market.

Retail Stock: Represents the total modern retail stock, consisting mostly of shopping malls and department stores.

Office Vacancy Grade A: Refers to Grade A office floor space (as a % of total Grade A stock) in existing properties that are physically vacant, ready for occupation in the next three months and are being actively marketed.

Grade A Office Rents: Average rents for a whole floor in the mid zone of a Grade A building. Does not include management fees or landlord incentives.

Retail Rents: Refers to average rents for tenants on the ground floor of modern retail centres (generally shopping malls and department stores). Does not include management fees or landlord incentives.

Management Fees: Refers to fees levied by property managers for general upkeep of commercial properties.

High-End Residential Capital Values: Refers to typical capital values (within a range) for high-end residential projects.

Grade A Offices – Indicative Yields: Refers to the best (i.e. lowest) yield estimated to be achievable for a notional office property of the highest quality and specification. Indicative yields represent Jones Lang LaSalle’s ‘market view’, based on a combination of market evidence where available, and a survey of expert opinion.


Contacts:

Contacts:

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Jeremy Kelly Global Research Programmes Jones Lang LaSalle +44 20 3147 1199 [email protected]

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QingdaoUnit 22A Qingdao International Finance Centre 59 HongKong Middle Road Shinan District, Qingdao 266071 Shandong, Chinatel +86 532 8579 5800 fax +86 532 8579 5801

Shanghai25/F Plaza 66, Tower 2 1366 Nanjing Road West Shanghai 200040, Chinatel +86 21 6393 3333 fax +86 21 6393 3080

Shenyang1808 Office Tower, L’Avenue 10 Huigong Street, Shenhe District Shenyang 110013 Liaoning, Chinatel +86 24 3109 1300 fax +86 24 3109 1330

ShenzhenRoom 2801-02, 28/F Tower Three, Kerry Plaza 1 Zhongxinsi Road, Futian District Shenzhen 518048 Guangdong, Chinatel +86 755 2210 0888 fax +86 755 2388 7600

TianjinUnit 3509 The Exchange Tower 1 189 Nanjing Road Tianjin 300051, Chinatel +86 22 8319 2233 fax +86 22 8319 2230

WuhanUnit 3202-03 Corporate Centre 5 1628 Zhongshan Avenue Jiang’an District Wuhan 430014, Hubei, Chinatel +86 27 5959 2100 fax +86 27 5959 2144

Xi’anUnit 2202-03 CapitaMall Office No.64 West Section of South 2nd Ring Road Yanta District Xi’an 710065 Shaanxi, Chinatel +86 29 8932 9800 fax +86 29 8932 9801

Hong Kong6th Floor Three Pacific Place 1 Queen’s Road East Hong Kongtel +852 2846 5000 fax +852 2845 9117 www.joneslanglasalle.com.hk

MacauUnit H, 16/F Finance and IT Center of Macau Nam Van Lake Quarteirao 5 Lote A Macautel +853 2871 8822 fax +853 2871 8800 www.joneslanglasalle.com.mo

Taiwan20/F-1 TAIPEI 101 TOWER No 7 Xinyi Road Section 5 Taipei 11049, Taiwantel +886 2 8758 9898 fax +886 2 8758 9899 www.joneslanglasalle.com.tw

Documents

China’s City Winners - JLL City XianProfile... · Xi-Xian New Area Approved by the State Council and established in February 2010, Xi-Xian New Area covers 882 sq ... 6 China’s