Property Times

Investment Rating - The report indicates a positive investment outlook for the North China region, particularly in the commercial real estate sector, with strong demand and rising rental prices in key cities [1][2][3]. Core Insights - The North China region's economy is stable with growth, particularly in Beijing, Tianjin, and Xi'an, where GDP growth rates exceed the national average [9][10]. - The demand for Grade A office space remains robust across the six cities in North China, with significant absorption rates and rental increases noted in Beijing and Tianjin [11][12]. - The retail market shows steady growth, with a stable rental environment despite increased competition from new supply in major cities [49][53]. - The residential market is active, with varying trends in price and volume across different cities, indicating a complex landscape influenced by local policies and market conditions [86][95]. Economic Overview - The GDP of Beijing reached 1,376.62 billion RMB (226.05 billion USD) in Q3 2013, with a year-on-year growth of 7.7% [9][10]. - Tianjin and Xi'an reported higher GDP growth rates of 12.6% and 11.5%, respectively, indicating strong economic performance [9][10]. Office Market - The average rental price for Grade A office space in Beijing increased to 298.9 RMB (49.1 USD) per square meter, reflecting a 0.7% quarter-on-quarter rise [11][12]. - The overall vacancy rate for Grade A offices in Beijing is low at 2.6%, with significant demand from domestic enterprises [18][19]. - In Tianjin, the average rental price for Grade A offices is 120.8 RMB (19.8 USD) per square meter, with a slight increase due to strong demand [24][25]. Retail Market - The retail market in North China is characterized by stable growth, with a year-on-year increase in social retail sales of around 10% [49][53]. - Beijing's retail market saw the introduction of several new shopping centers, contributing to a total retail space of 7,119,400 square meters [53][58]. - The average occupancy rate for new retail projects is above 80%, indicating strong initial performance [54]. Residential Market - The residential market in Beijing experienced a decline in transaction volume but an increase in prices, with average prices reaching 52,129 RMB (8,559.8 USD) per square meter [88][89]. - In Tianjin, the average transaction price for new residential properties rose to 14,495 RMB (2,380 USD) per square meter, reflecting a 5.5% increase [95][96]. - The residential market in Xi'an showed a decrease in transaction volume but maintained stable prices, with an average price of 7,192 RMB (1,181 USD) per square meter [121][122]. Investment Market - The investment market in Beijing remained active, with 43 transactions completed in Q4 2013, reflecting a 10.3% increase from the previous quarter [130][131]. - The total transaction value reached 50.74 billion RMB (8.33 billion USD), with a significant portion attributed to land transactions [130][131]. - The report anticipates continued interest from domestic and foreign investors in Beijing's real estate market, particularly in residential land [131][132].