wwc tianjincityprofile nov13 eng
TRANSCRIPT
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
1/24
WORLD WINNING CITIES
Global Foresight Series 2013
Chinas City WinnersTianjin City Profle
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
2/24
2 Chinas City Winners
Chinas City Winners: Tianjin
Jones Lang LaSalles ViewWhen we published our rst World Winning Cities prole in 2006,
Tianjin was a city with a strong but generic industrial base, a
decent port and some tired real estate stock. Times have certainly
changed, although international real estate investors have been slow
to get the message.
Since 2007, the economy has more than doubled in size and the
city is now home to what is arguably Chinas largest aerospace
manufacturing cluster. As the industrial base has continued to growother sectors such as tourism have taken off. Multiple ve-star
hotels dot the riverside and Tianjins former Italian concession is
now a popular pedestrian retail area. The rusting skeletons of half
completed ofce projects that used to dot the skyline have been
replaced by iconic ofce towers and retail centres.
We understand why the city has its sceptics. When a city of 13
million doubles the size of its modern residential and commercial
stock all within just a few short years - it looks like a bubble from
almost every angle. However we have observed that when a city
of this size retools, the overcapacity created short term can be
absorbed in mammoth cycles of take up that follow.
One of the most puzzling aspects of the current cycle is the lack of
quality ofce space. The construction of ofce buildings is currently
dominated by domestic developers who almost exclusively sell them
strata title. As a result, the leading ofce towers have maintained
occupancy rates in excess of 90% and MNCs have few options for
expansion.
Tianjins Binhai New Area is another example of a little understood
and poorly marketed area that has not helped the citys image.
Central to Tianjins economy, but located on its eastern edge, the
key industrial area has been widely panned for its attempt to create
the Yujiapu Financial District. Some of the criticism is well deserved,
but projects with 20 year timelines seldom look great only three
years into the development cycle. No one expects Tianjins Yujiapu
to rival Shanghai or Hong Kong, but a city of 13 million should be
able to successfully create a district with a core nancial component,
provided the government rst invests in the infrastructure, seeds it
with SOEs and layers on nancial incentives.
Tianjin sceptics will continue to abound, but just as the leaders of
Tianjin have nally worked out how to leverage their industrial andpopulation base, some investors are positioning themselves to take
advantage of one of Chinas fastest growing economies.
HAINAN
TAIWAN
JILIN
HEILONGJIANG
LIAONINGHEBEI
INNER MONGOLIA
HEBEISHANXI
JIANGSU
ZHEJIANG
FUJIAN
ANHUI
SHAANXI
HUBEI
HENAN
NINGXIA
QINGHAI
XINJIANG
TI BE T
SICHUAN
GUIZHOU HUNAN
JIANGXI
GUANGDONGGUANGXI
YUN NAN
GANSU
SHANDONG
Tier 1 Core
Tier 1.5 Transitional
Tier 2 Growth
Tier 3 Emerging
Suzhou
Ningbo
Shanghai
Wuxi
Wuhan
Tianjin
BeijingDalian
Nanjing
Jinan
Shenzhen
DongguanGuangzhou
Shenyang
ZhengzhouXian
HefeiHangzhou
ChengduChongqing
Changsha
Qingdao
Taipei
MacauHongKong
Xiamen
Nanning
Kunming
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
3/24
Tianjin in Numbers
Tianjin City Prole 2013 3
Economic Dashboard
Size
Tianjin Beijing Chengdu Shenyang Chongqing
Area (sq km) 11,920 16,411 12,120 13,000 82,403
Permanent
Population
(million)
13.5 20.7 14.1 8.1 28.9
RegisteredPopulation
(%)
74 64 81 89 114*
GDP
(RMB billion)1,288 1,780 814 670 1,146
Growth
GDP
(% y-o-y)13.8 7.7 13.0 11.0 13.6
Permanent
Population
(% pa 2005-2011)
2.5 3.1 -0.1 -0.6 7.3
Infrastructure
Air Passengers(millions)
8.1 81.9 31.6 11.0 22.1
Openness
FDI
(USD billion)13.1 6.4 4.9 5.1 6.3
Note: Values are for 2012
* Chongqing has a signicant number of registered citizens working outsideof the city, which results in this high number.Source: National Bureau of Statistics of China
Tianjins Competitive Position
Vital Statistics
1 1st in China for GDP growth rate (2010, 2011 and 2012)
1 1st in China for dynamic growth potential (2012)
4 4th in China for government transparency (2012)
4 4th in China for attractiveness of property development (2012)
4 4th in the world for GDP growth rate to 2025 (2011)
5 5th in China for development potential (2011)
12 12th in the world for total GDP by 2025 (2011)
Source: China Institute of City Competiveness; Chinese Academy of SocialSciences; Jones Lang LaSalle
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
4/24
4 Chinas City Winners
expansion in recent years. According to the municipal governments
12th Five-Year Plan, Tianjin aims to boost advanced manufacturing
industry and to also accelerate the development of a modern
services sector, the latter of which is projected to contribute to half of
the citys total GDP by 2015.
Tianjins expanding urban area
With a total area of 11,920 sq km, Tianjin comprises 12 districts,
three counties and the Tianjin Binhai New Area (TBNA), which
constitutes a sub-provincial city. In terms of economic and real
estate development, the citys key geographic areas are as follows:
Central Tianjin(comprising of Heping, Hexi, Nankai, Hedong,Hebei and Hongqiao Districts) is the citys main business area.
It is where most multinational services rms and retailers,
as well as its main commercial property developments, are
concentrated.
TBNA, with an area of 2,270 sq km, is (after Central Tianjin) the
citys second strongest area for real estate and manufacturing
activity. Its a key economic engine for the city, consistently
reporting economic growth in excess of 20% per year since
2006. Within the TBNA, areas that are witnessing major
development include:
Tianjin Economic-Technological Development Area
(TEDA). One of the rst state-level development areas
approved by the State Council of the PRC, TEDA has
established itself as the most important manufacturing
base in Tianjin, and is now dominated by international
manufacturing giants such as Samsung, Motorola and
FAW-Toyota. Currently, all of the Grade A ofce space in
the TBNA is located within the TEDA Modern Service District
(TEDA MSD), the rst phase of which was completed in2011. Several reputable local and domestic developers have
launched high-end residential projects in the area, including
Vantone Central Park, Vantone Mansion and Warner
Garden.
Yujiapu Financial District.Covering a land area of some
3.86 million sq m, the district has 120 planned plots which
will equate to a total construction mass of around 9.5 million
sq m, of which over 50% has been allocated for ofce
space. Positioning itself as the nancial innovation centre
for Northern China, this large-scale project commenced its
four-phase construction in 2009; no exact date has been set
for its completion.
City Overview
One of the worlds fastest growing cities
Tianjin is located in Chinas north-eastern Bohai Bay area, about
140 km south-east of Beijing. It is one of the four municipalities of
the Peoples Republic of China along with Beijing, Shanghai and
Chongqing. In recent years, Tianjin has experienced extraordinary
economic development at a rate faster than the national average,
earning the accolade as one of the worlds fastest growing large
cities. Its growth has been underpinned by massive infrastructure
investment, high levels of foreign direct investment and strong policy
support from central government as one of the countrys key national
growth poles. According to Jones Lang LaSalles China50 research
report, Tianjin has the highest level of economic development
outside of Chinas Tier 1 Cities.
With a coastline that stretches approximately 153 km, Tianjin has the
biggest port in Northern China, which has and continues to fuel the
expansion of the citys trade, shipping and logistics sectors. The city
is also the largest industrial centre in the region, with manufacturing
the main contributor to the local economy. Tertiary industries, such
as nance and business services, have also experienced rapid
City Evolution: Economy Score Improvements, 2009 - 2012
Source: China50, Jones Lang LaSalle
Tianjin
Suzhou
Wuhan
Chongqing
Hangzhou
Nanjing
Chengdu
Dalian
Shenyang
Dongguan
Changsha
Wuxi
Qingdao
Jinan
Ningbo
Xian
Foshan
Hefei
Zhengzhou
Changzhou
Low
2009 2012
High
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
5/24
Source: Tianjin Municipal Statistics Bureau
2011 GDP
2011 Population
Area
TBNA
Central Tianjin
Other Districts
Greater Tianjin
Tianjin City Prole 2013 5
Area
(sq km)
2011 GDP
(RMB billion)
2011
Population
(million)
TBNA 2,270 620.7 2.5
Central Tianjin 173 231.7 4.5
Other Districts and
Counties
9,460 278.3 6.5
Source: Tianjin Municipal Statistics Bureau
Sino-Singapore Tianjin Eco-City (SSTEC).A joint venture
between a consortium of Singapore and Chinese companies,
SSTEC is a planned 30 sq km sustainable residential
model city designed to create a liveable and eco-friendly
community for 350,000 residents by 2020. Thus far, the
overall scheme has attracted recognised developers from
across the globe, including Mitsui Fudosan Residential Co.,
Ltd. (Japan), Sunway City Berhad (Malaysia), Samsung
C&T Corporation (Korea) and Ayala Land, Inc. (Philippines).
SSTEC will be providing the infrastructure and amenities,
which will include education and medical facilities, as well as
retail areas.
Haihe River
Tianjin Outer Ring Road
Tianjin Inner Ring Road
High Speed Railway Line
Central Tianjin
Greater Tianjin
JIXIAN
COUNTY
BAODI
DISTRICT
WUQING
DISTRICT
BEICHEN
DISTRICT
DONGLI
DISTRICT
XIQING
DISTRICT
NINGHE
COUNTY
JINNAN
DISTRICT
JINGHAI
COUNTYBINHAI
NEW AREA
HEPING
HEBEIHONGQIAO
NANKAI
HEXI
HEDONG
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
6/24
Tianjins Districts and Counties (2011)
Source: Tianjin Municipal Statistics Bureau
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
39%
60%
Primary Secondary Tertiary
Million
20112005
6 Chinas City Winners
Tianjins Employment Structure
Sector Trends
Source: Tianjin Municipal Statistics Bureau
Industry Primary Secondary Tertiary
Trend Decreasing signicantly Increases slowing down Increasing sharplyFactors Mechanisation of farms reduces the need
for farm workers. Rural workers migrate tourban area
Workers prefer better paid and lessphysically demanding jobs in thesecondary or tertiary sectors
Tianjin has developed into North Chinaslargest industrial centre. The secondarysector is currently the major contributor
to Tianjins economy providing manyemployment opportunities
The progress of science and technologygreatly improve labour productivity andpromote the optimisation and upgrade ofTianjins industrial structure.
As Tianjin matures, services like health,education and tourism are becomingmore crucial; workforce demand in thesesectors grows rapidly
More and more foreign banks andprofessional services rms enter Tianjinto open branches, adding employmentopportunities
Producer services for the manufacturingindustry also enjoy rapid development and
create many employment opportunities,
e.g. scientic research and technicalservices
Demographics and Employment
Tianjins total permanent population stood at 13 million by end 2011,up 30% since 2005 - an addition of an average 0.6 million new
residents per year over the period. When compared to 2001-2005
and its 4% expansion, the population growth rate has rocketed.
According to the Sixth Population Census, Tianjin is one of the
fastest growing cities in terms of permanent population, and is
ranked fth for its growth rate among Greater Chinas cities.
District Permanent
Population
000s
GDP
RMB billion
Central Tianjin Heping District 303.1 57.747
Hedong District 889.8 25.406
Hexi District 901.0 58.513
Nankai District 105.54 48.001
Hebei District 805.3 29.198
Hongqiao District 546.9 12.868
TBNA 2536.6 620.687
Suburban Dongli District 635.4 60.281
Xiqing District 741.3 59.550
Jinnan District 629.8 37.997
Beichen District 704.3 56.299
Wuqing District 1005.1 45.551
Baodi District 831.2 32.333
Others Ninghe County 431.0 22.495
Jinghai County 674.3 34.366
Jixian County 855.3 25.011
The surge in people numbers is reected in the escalation in the size
of Tianjins labour force which had reached over 7 million by 2011,
an increase of 41% since 2005. The workforce employed in the
tertiary sector has experienced even greater growth, rising by over
60% since 2005.
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
7/24
Tianjin City Prole 2013 7
Economic Background
Double-digit growth since 2004
Tianjins economy has maintained double-digit growth since 2004,
with average GDP growth above 15%, signicantly higher than
the national average. According to data released by the Tianjin
Municipal Statistics Bureau, the citys GDP reached RMB 1,289
billion in 2012, an increase of 13.8% on 2011. Although this is a
slowdown on the 16.4% achieved in 2011, the growth rate is still
nearly double the national average and the highest in the country.
By the end of 2012 per capita GDP in Tianjin stood at more than
US$14,800.
The citys economic boom is expected to maintain its strong upwards
trajectory, driven by infrastructure spending in the short term and the
development of the TBNA over the longer term. The success of the
TBNA, as one of citys main economic development zones, can be
measured by its generation of 55.9% of the citys GDP in 2012 and
the 20% + year-on-year GDP growth, and also, comparatively, by
the fact that its growth rate has surpassed Shanghais Pudong New
Area.
Secondary industries continue to dominate
Tianjin is Northern Chinas largest industrial centre with pillar
industries in automobile, micro-electronics and biomedicine. The
tertiary sector experienced rapid growth of 12.4% in 2012 and
accounted for 47% of the citys total GDP, yet despite these strong
gures, the secondary industry remains the main driver of the
citys economy, reected in its proportion of secondary industries,
which is larger than the average for Chinas coastal provinces and
municipalities.
Attracting domestic and foreign retailers
Tianjins total retail sales of consumer goods grew by 15.6% in 2012
to reach RMB 392.1 billion, which puts it at the forefront of rankings
for retail growth among Chinas principal cities. With Tianjins more
attractive city offer and rising shopper afuence, it has rapidly taken
on greater market signicance, and this has been reected in the
arrival of a large number of major retailers in recent years, such as
IKEA, COFCO Joy City, Lotte Department Store and Walmart.
Tianjins GDP Growth 2005-2012
Source: Tianjin Municipal Statistics Bureau
Tianjins GDP by Industry, 2005-2012
Source: Tianjin Municipal Statistics Bureau
Source: Tianjin Municipal Statistics Bureau
GDP Growth Rates Compared, 2012
0%
5%
10%
15%
20%
25%
0
200
400
600
800
1,000
1,200
1,400
2005 2006 2007 2008 2009 2010 2011 2012
GDP Growth Rate
RMB
billion
0%
Tianjin
Chon
gqing
Chen
gdu
Xian
Shen
yang
Qing
dao
Guan
gzho
u
Shen
zhen
Beijin
g
Shan
ghai
3%
6%
9%
12%
15%
55.2%
43.0%
0%
20%
40%
60%
80%
100%
2005 2006 2007 2008 2009 2010 2011 2012
Primary Secondary Tertiary
2.9%
54.7%
42.5%
2.3%
55.1%
42.6%
2.1%
55.1%
42.8%
1.7%
53.0%
45.3%
1.8% 1.6%
53.1%
45.3%
1.4%
52.4%
46.2%
1.3%
51.7%
47.0%
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
8/24
8 Chinas City Winners
Now in its 12th Five-Year Plan, Tianjin is shifting from growth and
quantity to development and quality, and a key element within its
plans is the improvement of the citys living environment through the
establishment of three particular zones whose primary objective is
ecological and environmental protection. These zones, dispersed
from the north to the south of the city, take advantage of the Jixian
mountain regions and the areas existing wetlands, and are looking
to attract real estate development interests, particularly residential.
Airport expansion
Tianjin Binhai International Airport is located in the Dongli District, 13
km from the city centre, and in 2012 it had a passenger throughput
of 8.1 million, an increase of 7.3% on 2011. Terminal One,
which opened in April 2008, has an annual capacity of 10 million
passengers; having received formal approval from the National
Development and Reform Commission in 2010, phase two of the
airports development is underway with the completion of a 220,000
sq m second terminal anticipated for 2014. This is expected to
double the passenger capacity of the airport, which will both meet
the aggressive growth in demand and turn the city into the most
important air cargo transportation and distribution hub in North-East
Asia.
Tianjin West Station redevelopment
Located in Hongqiao District, the new Tianjin West Railway Station,
which opened in June 2011, has become one of the largest
integrated transportation hubs in China combining the Beijing-
Shanghai (Jinghu) high-speed railway with the Tianjin Metro and
local Mass Transit systems.
The stations inuence on the vicinity has begun to take effect, with
land values reported to have risen by more than 200% over three
years. The municipal government is planning for the area to becomea secondary commercial submarket to include ofce, retail and
serviced apartment developments, and major developers such as
TEDA Group, Vantone Real Estate and the Lujiazui Development
Group from Shanghai are already active in the area.
High-speed rail connections
As of 2012, there are two main high-speed railway lines running
through Tianjin, connecting to Beijing, Shanghai and other major
Chinese cities. The increased connectivity between Tianjin and
other urban centres is a critical component to the ongoing economic
development of the citys economy.
Urban Planning and Infrastructure
Focusing on development and quality
In its overall urban planning for the period 2005-2020, the Tianjin
Municipal Government laid out a sizeable list of tasks to be
accomplished. One of the most important was to develop two new
secondary commercial zones to the north-west and south-east of
Central Tianjin, namely Wuqing New Town and Tianjin Binhai New
Area (TBNA). Situated between Beijing, Central Tianjin and Bohai
Bay, these commercial zones were planned so as to leverage
existing economic activities in the two major cities, all interconnected
through a series of Bejing-Tianjin-Tanggu expressways.
Three Axes
Two Belts
Six Plates
Jixian County
Baodi District
Wuqing District
City Center
Ninghe County/Hangu
TBNA Core Area
Jinghai CountyDagang
East:To develop the port and the city towards the sea
South:To move the chemical industry to Dagang in the south
West: To integrate each functional zone along Jinbin Corridor
North:To improve the ecological environment of Hanggu in the north
Middle:To promote the comprehensive service functions of the core
City Spatial Structure
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
9/24
Tianjin City Prole 2013 9
Beijing-Tianjin high-speed railway
The 115 km high-speed railway line was completed in August
2008, and has reduced travel time between Tianjin and Beijing to
just 33 minutes. Following the route of the Beijing-Tianjin-Tanggu
Expressway, the line has greatly enhanced the citys connectivity,
encouraging the development of tourism and other tertiary
industries, and improving business cooperation and communications
between the two cities.
Beijing-Shanghai (Jinghu) high-speed railway
In June 2011, Tianjin was joined to the Jinghu high-speed railway
line, connecting it with Beijing and Shanghai, as well as the
provinces of Hebei, Shandong, Anhui and Jiangsu. Currently, there
are 14 high-speed trains to Shanghai Hongqiao station daily with a
travel time to Shanghai of about ve hours; ve of the trains start
from Tianjin West Station.
Tianjin-Qinhuangdao (Jinqin) high-speed railwayThe Jinqin high-speed railway, which is expected to be completed in
August 2013, will run across the Bohai Sea region and be a key line,
linking other parts of Chinas railway network with the high-speed
system, and thereby improving connectivity between north-east,
north and south China.
Expressway connectivity
Seventeen expressways have been established in Tianjin, and
the key roads within its regional network currently include: Tianjin-
Beijing-Tanggu Expressway; Tianjin-Jixian Expressway; Tianjin-
Baoding Expressway; Rongwu Expressway; Central Avenue
running through Hangu, Tanggu and Dagang; and Tianjin Avenue
connecting Central Tianjin and Binhai New Area.
North Chinas largest port
Tianjin Port:Approximately 170 km from Beijing and 60 km from
Central Tianjin, Tianjin Port is one the countrys most important
commercial ports due to its strategic location on Bohai Bay. As one
of the main shipping hubs on the Chinese coast, it provides links
to more than 400 ports in over 180 countries, and in 2012 handled
476 million tons of cargo and 12.3 million TEU of containers,
making it the worlds fourth largest port by throughput. Its capacity is
increasing at a rapid rate, and by 2017 the port is expected to handle
600 million tons.
Beijing - Tianjin Rail and Highway Infrastructure
Haihe River
Inner Ring Road
Outer Ring Road
Beijing-Shanghai High-speed Rail
Beijing-Tianjin Expressway
Beijing-Tianjin-Tanggu Expressway
Beijing-Shanghai Expressway
Beijing-Tianjin Inter-city Rail
Tianjin Avenue
Beijing
Tianjin
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
10/24
Tianjin Metro Map (Central Tianjin)
10 Chinas City Winners
Key projects in Dongjiang Port
Dongjiang Port:An extension of Tianjin Port, Dongjiang Port has
been built on reclaimed land and is part of the plan to develop
the Tianjin Binhai New Area (TBNA) into a shipping and logistics
centre for Northern China. The peninsula has a total area of
around 30 sq km and has zones designated for dock operations,
logistics processing and auxiliary services, the latter of which will
accommodate the development of commercial, residential, tourist
and leisure facilities.
The development of the Metro
In 2008, the municipal government established a 10-year blueprint to
build a metro network comprised of more than 10 lines to serve both
Central Tianjin and the TBNA. Increasing road congestion and the
consequent net economic cost, as well as the human toll through a
high road-trafc accident rate, have all contributed to the promotion
of metro lines as the optimum passenger transport solution to also
meet the citys escalating population growth and the expansion of its
working and living areas.
The Tianjin metro network incorporates a mixture of hub-and-spoke
and linear networks that connect Tianjins developing and existing
commercial areas. Subway Lines 2, 3 and 9 converge at Tianjin
Station, which is the main transportation hub for the city, while Lines
6, 7 are the outer linear lines that circle around the hub. However,
even with an adopted blueprint, completion of these metro lines
has been slow, stalled by relocation and construction issues. The
Tianjin International
Cruise Home Port
South of the service zone, serving cruise linesfrom Japan and Korea
Includes ofces, hotels, serviced apartments, anexhibition centre and shops
Ocean One Southeast of the service zone
Includes a hotel, residential, marina club, shops,and a pedestrianised street along the water
Line No. 5
Line No. 4
Line No. 1
Line No. 2
Line No. 3
Line No. 7
Line No. 6
Line No. 9
Line No. 8
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
11/24
-
-
Tianjin City Centre
1
29
Haihe River
HaiheRiver
Haihe River
3 TBNA40km
Liuyuan
XihengdiGuojiuchang
Benxilu Qinjiandao
Honghuli
West Train Station
XibeijiaoXinan
jiao
Yananxilu
Caozhuang
J ieyuanxidao Hong-qilu
Xianyanglu
Guang-kaisimalu
Gulou
Erweilu
Haiguangsi
Dong-nanjiao
Anshan-dao
Hepinglu
JinwanPlaza
Jianguodao
JinshiBridge
Zhongshanlu
North Station
Tiedonglu
Zhangxingzhuang
Yixingfu
Puyu Park
Jinwei Road
Fengchan River
Xiaodian
TianjinStation
Xinkailu
Dawang-zhuang
Zhigu
Shiyiji-nglu
Dongxinglu
Zhongshanmen
YihaoBridge
ErhaoBridge
Zhangguizhuang
Xinli
Dongli
EconomicDevelopmentZone
Xiaodong-zhuang
Junliangch-
Gangguangongsi
eng
Gangguangongsi
Hujiayuan
Chezhan-beilu
Tanggu
TEDA Citizen Plaza
BinhaiCollege
Huizhanzhongxin
Donghailu
Jingjianglu
ShunchiBridge
Cuifuxin-cun
Helanlu
Dengzhoulu
Guoshanlu
Tianjin AirportEconomic Zone
TianjinBinhaiInternational Airport
Ying-koudao
Xiaobailou
XikangluWujiayao
Tianta
ZhoudengMemorial Hall
HongqinanluWangdingdi
Huayuan
University City
Hi-Tech Zone
Xiawafang
NanlouTucheng
Chentangzhuang
Fuxingmen
HuashanliShuanglin
TianjinUniversityof Finance&Economics
Tianjins Metro System 2013
Tianjin City Prole 2013 11
updated and extended Line 1 was already operating prior to the
2008 blueprint but by 2012, only an additional three metro lines
- 2, 3 and the extended 9 - had begun successful operation.
Over the last few years, the areas around Line 1 stations have
become integrated commercial zones, hosting a number of
business, administrative and retail operations. Within these zones,
Nanjing Road and Xiaobailou are among the major ofce and retail
submarkets that have achieved the highest rents and capital values.
Along the other newly-operating lines, the associated commercial
zones are expected to witness a similar growth in real estate
activity, and looking further ahead, the continued development of
Tianjins metro network will help to accelerate economic activity in
several districts and reduce the differences in population distribution
between developed and less developed districts.
Current Metro lines
By early 2013, four metro lines were in operation linking the current
major commercial areas in Central Tianjin:
Line 1 runs from north-west Tianjin to the east via the city centre,
and serves Beichen, Hongqiao, Nankai, Heping, Hexi, and
Jinnan Districts. Line 1 enables Tianjin residents to travel to
the citys main commercial areas, such as Nanjing Road and
Xiaobailou.
Line 2 travels from east to west through Central Tianjin, and
crosses the Old Town Area, a key residential and commercial
area.
Line 3 connects Xiqing District in the south and Hebei District in
the north, and runs through key new residential and commercial
areas.
Line 9, with a starting point at Tianjin Station, is the primary metro
line connecting Central Tianjin to TBNA in a reduced travel time
of only 45 minutes.
Since October 2012, the connection of metro lines 2, 3, and 9, has
resulted in Tianjin Station becoming the primary hub for all public
transportation in the city, providing, in addition, the onward link to
Beijing through the high-speed rail line.
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
12/24
12 Chinas City Winners
aviation, petrochemical, heavy machinery, electronic information,
biomedical, new energy and defence technology. Early evidence
that the plan is bearing fruit is shown by a near 15% increase in
Tianjins industrial production in 2012. Much of the output growth has
come from new projects coming on line; for instance, the launch of
a new mobile phone facility for Samsung, and the expansions of the
Great Wall Motor Company and the helicopter division of the China
Aviation Industry Company.
For the tertiary sector, the goal is for it to increase its contribution
to 50% of the citys total GDP by 2015. One of the main tactics is
to develop additional services specic to manufacturing industries;
for instance, professional services in the form of computer and
data processing, accounting/auditing, consulting, advertising and
engineering companies. This has resulted in companies such as
Industrial Bank of Taiwan, Halliburton and Cameron Pace Group (a
leader in 3-D technology and production services) already setting up
ofces in Tianjin.
Development of TBNA
In 2006, the State Council of the PRC selected the TBNA as one ofthe rst regions in China to pilot a nancial reform programme, and
Core Activities
Huge strides in economic development
Tianjin has made huge strides in its economic development, with
double-digit growth on GDP, retail sales and FDI over the past
ve years. According to the municipal governments 12th Five-
Year Plan, the main agenda for 2011 to 2015 includes continued
economic growth; the transformation of the citys economic structure;
an improvement in Tianjins ecological, social and cultural living
environment; and a particular emphasis on the development of the
Tianjin Binhai New Area (TBNA).
Sustained economic growth
According to the Five-Year Plan, released by mayor Huang Xingguo
in January 2012, the government has set an annual GDP growth
rate of 12% for the ve years, 2011-2015. The city is already
outperforming this projection with rates of 16.4% in 2011 and 13.8%
in 2012, and although it may cool to a slower rate, double digit
growth is expected to be maintained through to 2015.
Transformation of the economic structure
The government plans to expand and strengthen both the secondary
and the tertiary sectors. For the secondary sector, the focus will be
placed on higher-value-added manufacturing industries such as
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
13/24
Tianjin Foreign Direct Investment, 2005-2012
Source: Tianjin Municipal Statistic Bureau
3.3 4.15.3
7.49.0
10.8
13.115.0
15.0%
0%
10%
20%
30%
40%
50%
0
5
10
15
20
2005 2006 2007 2008 2009 2010 2011 2012
Foreign Direct Investment Growth
USD
billion
Tianjin City Prole 2013 13
encouraged the local governing body to promote major pilot reforms
of nancial enterprises, businesses and markets within the economic
development zone. Advantageous tax incentives and innovative
nancial structures were tested in the TBNA by companies
registered in the area, the main goal being to encourage private
equity investment through various government-backed industry
investment funds.
At the end of 2007, the largest domestic government-guided
venture investment fund, the Binhai New Area Venture Capital
Steering Fund, was launched. The RMB 2 billion fund was designed
to act as a parent fund to attract domestic and foreign venture
capital organisations to the TBNA, while part of it was used to helppush ahead with the construction of 12 scientic research and
development centres for Tianjins pharmaceutical, biological, aviation
technology and other industries.
One of the key steps in this development was the creation of the
Tianjin Innovative Finance Investment Co., Ltd. TIFI, as it is also
known, was incorporated with a capital of RMB 2 billion and is the
operator of the overall planning, construction and management of
Yujiapu Financial District (YFD), and currently manages over RMB
20 billion of assets. TIFIs role is to provide construction and nancialsolutions and to also help secure favourable policies for YFDs
investors and developers, by taking advantage of its privileged
access to funding from central government and commercial lenders.
Business EnvironmentHigh levels of FDI
The Tianjin municipality has impressed investors with its growth
potential and, accordingly, FDI has increased steadily in recent
years at a pace above 10% per annum (2005 to 2012), one of the
fastest growth rates among Chinas cities. Total FDI reached US$13
billion in 2011 which equated to an impressive 20% year-on-year
growth rate. A large portion of this investment has come off the back
of strong fundamentals and the potential derived from the citys
traditional industrial focus on equipment manufacturing, automobiles,
electronic information and petrochemicals.
Since our last report in 2006, Tianjin has also established additional
industrial clusters in aerospace and new energy, and moreover, by
end 2012, some 150 of Fortune Global 500 companies had set up
subsidiaries or manufacturing bases in the city.
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
14/24
14 Chinas City Winners
Continued vigour in Tianjins real estate markets comes at the
same time as administrative measures are being enforced to cool
investment in this sector, and based on factors such as investment
volumes, development activity and retailer concentrations, Tianjins
real estate market still ranks below other Tier 1.5 cities such as
Chengdu, Shenyang, and Chongqing. However, the arrival of several
new department stores and shopping centres are transforming the
citys prime retail districts into more diverse and attractive shopping
destinations. Thus, given the level of central government support for
the municipality, and the fact that the development of its property
market still lags behind many other Tier 1.5 cities, Tianjins real
estate sector should have more than enough potential to continue its
growth over the coming years.
Rapid real estate development
Real estate development in Tianjin continues to be one of the
largest and fastest-growing xed-asset investment categories, with
investment remaining exceptionally and consistently strong through
the recent stimulus cycle.
Source: Tianjin Municipal Statistics Bureau
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
2007 2008 2009 2010 2011
Investment in Real Estate
Total Fixed Asset Investment
RMBmillion
Key Industries/Sectors
Pillar industries continue to dominateTianjin has followed a high-investment and high-output growth model
over the past few years, as it strives to develop into Northern Chinas
largest industrial centre. The pillar industries in the citys economy
include equipment manufacturing, petrochemicals, electronic
information, and light manufacturing and textile industry, which
together account for 90% of gross output; equipment manufacturing
alone contributes 41%. Evidence of the strength of Tianjins key
industries is clear through the established presence of names such
as Airbus, Bohai Drilling, Bohai Equipment and Vestas; and also in
newcomers like John Deere, Joy Mining Machinery and the blade
project of Dongfang Electric (Tianjin) Wind Power Technology.
Pillar industries in Tianjin 2011
Source: Tianjin Municipal Statistic Bureau, 2012
SectorGross Output Value of Industry
(Billions RMB)%
Total 2,109 100
Equipment
Manufacturing873 41
Petrochemical 394 19
Electronic Information 329 15
Light Manufacturing andTextile
310 15
New Energy and NewMaterial
102 5
Biomedical 76 4
Aerospace 25 1
Real estate sector: Investment in xed assets in urban areas
Real Estate 2007 2008 2009 2010 2011
Value
(RMB100 millions)505.3 653.7 735.2 866.6 1,080.0
y-o-y increase 25.6% 29.4% 12.5% 17.9% 24.6%
National Ranking 2nd 2nd 2nd 2nd 2nd
Total xed assetinvestment
(RMB millions)
2,227.7 3,189.5 4,700.3 6,114.3 7,057.2
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
15/24
Tianjin City Prole 2013 15
Source: Ministry of Education, 2012
Education
A major academic hub
Tianjin is one of Chinas major academic hubs; according to the
2012 Tianjin Statistical Yearbook, the city is home to 55 higher
education institutions and has a total enrolment of nearly 450,000
students. Comprising a mixture of general universities and several
specialising in science and engineering, Tianjins higher education
system is comprehensive and covers every major discipline, and its
highest prole colleges include Nankai University, Tianjin University,
Tianjin Medical University and Tianjin University of Finance and
Economics. Furthermore, the city also has 139 scientic research
and technological development institutes, which engage over 13,000
professionals. The National Sixth Population Census reported that
17.5% of Tianjins population had received a higher education.
The citys latest Five-Year Plan for education is primarily concerned
with the deepening of research and development skills, and besides
comprehensively strengthening the quality of higher education,
Number of Universities
a greater emphasis on vocational universities and professional
institutions will be central to advancing this objective.
Tianjin Haihe Education Park: positioned as a state-level
exhibition of vocational education reform and innovation, the
park covers an area of 37 sq km located on the south bank of
the Haihe River between downtown Tianjin and Binhai New
Area, and consists of three parts: Higher Vocational Colleges
Park, Higher Education Park and High and New Technology
Research Park. Construction commenced in 2009 and
seven vocational colleges have now been completed, with
more planned, including new campuses from the two most
renowned universities in the city Nankai University and Tianjin
University.
Source: Tianjin Statistical Yearbook
Tianjin Higher Education Indicators (2011)
Higher Education Institutions 55
Graduates 108,723
Enrolment 449,702
0 20 40 60 80 100
Jinan
Shenyang
Zhengzhou
Chengdu
ChangshaChongqing
Tianjin
Nanjing
Shanghai
Xi'an
Wuhan
Guangzhou
Beijing
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
16/24
16 Chinas City Winners
Major Employers
Tianjin FAW Toyota Motor Co.,Ltd
Established in 2000, TFTM is located in Tianjin Economic and
Development Area (TEDA) with a total area of 1.55 million sq m. It is
a joint venture company funded by China FAW Group, Tianjin FAW
XIALI Automobile Co., Ltd, Toyota Motor Corp and Toyota Motor
(China) Investment Co., Ltd. In 2011, TFTM completed production of
500,000 vehicles with a revenue of RMB 67.1 billion.
TEDA Investment Holding
TEDA Investment Holding was founded in 1984, along the
establishment of Tianjin Economic Development Area. As one of
the largest SOEs in Tianjin, TEDA Holding is a forerunner in various
business elds, including level one area development and real estate,
public facilities, manufacturing, nance and services. In 2011, its sales
revenue was RMB 58.3 billion and its total assets were valued at RMB
180.7 billion.
Samsung
Located in Tianjin Xiqing District Microelectronics Industrial Park,
Tianjin Samsung Communication Technology was established in 2001.
It was jointly founded by Samsung Electronics and Tianjin ElectronicInstrument Corporation and its core businesses focusing on the
manufacture and sale of GSM smart phones. The company is a major
engine of economic activity and annually is now producing more than
RMB 200 billion in revenue and indirectly generates approximately
150,000 jobs.
Airbus
Tianjin Airbus assembly line is the rst outside of Europe. Located
in the Tianjin Free Trade Zone, the assembly line, with a planned
production capacity to assemble 300 A320 planes by 2015, ofcially
opened in 2008. In 2009, Airbus also signed a Memorandum of
Understanding with Tianjin Free Trade Zone to establish a logistics
centre that will optimise its supply chain management for all of Airbus
vendors and clients in China. Airbus currently employs more than 400
employees in Tianjin, of which more than 95% are local.
United Technology Corporation - Otis
Otis, a United Technologies Corporate (UTC) subsidiary and the
world's leading manufacturer, installer and maintainer of elevators,
escalators and moving walkways set up its rst joint venture company
in 1984. In 2007, a 140,000-sq m Otis TEDA Manufacturing Base
was constructed in TEDA. As the Asia-Pacic manufacturing centre
of elevator and components, product R&D centre and industry chain
building centre, the current Otis TEDA Base has become the most
advanced elevator manufacturing base and the rst global Green-
power pilot factory.
Tinghsin
Tinghsin International Group is a Taiwan funded enterprise which
expanded aggressively in mainland China. It was founded in Tianjin
TEDA in 1991 with total investment in Tianjin reaching above RMB
5 billion. Tinghsin Group has many sub-brands including Tingyi, HY
Mall, Dicos and Family Mart. They attained revenue of RMB 6.8 billion
in 2010. Now, the group has 14 factories, four shopping malls and 50
restaurants in Tianjin with a 5,550 strong work force.
COSCO
China COSCO Holdings Company Limited was established in Tianjin
Port Free Trade Zone in 2005, and is listed on the stock exchange
in HKSE and SSE. It is the listed agship and integrating platform for
COSCO Group, the second largest integrated shipping company in
the world. The company is located 16 km away from the Tianjin Port
and has a campus of 200,000 sq m. Its core businesses are shipping,
logistics, terminal and related business and container leasing business.
Bohai Bank
Established in 2005 and located in Hexi District, Bohai Bank has made
a signicant mark in the nance sector. Their achievements include
being the rst national joint-stock commercial bank approved by the
State Council, the rst Chinese commercial bank that brought in a
foreign strategic investor at the initiation and establishment phase, and
also the rst national joint-stock commercial bank headquartered in
Tianjin. Bohai Banks total assets are estimated to be approximately
RMB 300 billion.
16 Chinas City Winners
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
17/24
Tianjin City Prole 2013 17
Financial Street acquires land in Tianjin
Financial Street (Tianjin), a subsidiary of Beijing Financial Street
Holdings Co., Ltd., has acquired a mixed-use plot located on the
south side of Changjiang Road in Tianjins Nankai district. The
purchase price of RMB 2.36 billion for the 79,600 sq m site was
the second highest achieved in Tianjin in 2011. The site has a
planned above-ground GFA of 295,000 sq m and will include
residential, retail, ofce and hotel space.
Unilever to build production base in Tianjin
Unilever plc, the worlds leading consumer product supplier, is
building one of its largest production bases in Tianjin. The facility,
located in Tianjin Airport Economic Zone, will cover a site area of
800 acres. Phase one of the project, incorporating 400 acres and
a total investment of US$100 million, started construction in 2011.
The base will increase its capacity continuously while producing
items such as washing-up liquid and toothpaste for the Chinese
market and for exports to nearby Asian markets.
E-Commerce gathering strength in Tianjin
Taking advantage of its skilled workers, recent high-tech
developments and its strategic location near Beijing, Tianjin
has become the preferential location for e-commerce operators.Adding to the current pool of globally recognised e-commerce
companies, such as Alibaba and Amazon, other e-commerce
companies have either relocated to the city or have plans to
do so; these include Sohu Video, OkayBuy and Dangdang.
Sohu Video recently invested US$20 million in the construction
of its Northern China headquarters in the Tianjin Economic-
Technological Development Area of TBNA, and OkayBuy has
selected Sino-Singapore Tianjin Eco-City for its back ofce
operation. Meanwhile, Dangdang has
invested RMB 400 million in setting
up its Northern China headquarters
in Wuqing District. The arrival of
these e-commerce businesses will
play a large part in Tianjins ongoing
economic growth, at the same time
strengthening demand within the
property market.
Recent Major Investments
Third Hotel Indigo in China opened in Tianjin
InterContinental Hotels Group introduced its Hotel Indigo brand to
the Xiaobailou Commercial Business District in September 2012.
The boutique hotel, occupying some 30,000 sq m, is located in the
Old German Concession and is the international operators third
Hotel Indigo in China.
IKEAs Tianjin store
IKEA, the Swedish home-furnishings group, has opened its Tianjin
store (their tenth in China) in Dongli District. The suburban location
is situated between Central Tianjin and Tianjin Binhai New Area,next to a light rail line and close to several major highways. The
46,000 sq m store includes showrooms, restaurants and the largest
IKEA childrens playground in China.
GE to set up Medical Equipment Project in Tianjin Port
US-based GE, one of worlds largest electrical and electronic
manufacturing companies, recently announced plans to build a
large-scale medical equipment manufacturing facility in the Tianjin
Port Free Trade Zone. With a total investment of US$70 million,
the projects rst phase will focus on producing high-end precisionmedical equipment. Once complete, it is anticipated that the facility
will be one of GEs largest production bases anywhere in the world.
The Free Trade Zone has attracted 21 projects from Fortune Global
500 companies, and from existing companies in the area including
Mitsubishi, Samsung, Carrefour and Ford.
Archer Daniels Midland Company (ADM) plans Grain and Oil
Base in Tianjin
ADM, a US-based Fortune 500 company, has announced a
cooperation agreement with the Binhai New Area Economic Port
Zone that will lead to the development of a food-focused logistics
and processing plant responsible for grade sugar syrup production,
our milling and edible cellulose production. The projects rst phase
will cover a site area of 490,000 sq m, which will be signicantly
larger than COFCOs plant in Tianjin, ADMs main competitor. The
project began construction in 2012 with an allocated investment
of US$300 million. ADMs presence in Tianjin is expected to help
create further opportunities for future cooperation in related elds
within the food industry chain.
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
18/24
Key Players
Investors
Ofce Local developers Ningfa, Tianfang Group, Tifen,Wanshun
Domestic
developers
Beijing Financial Street, CITIC,COFCO, Forte, R&F Properties
Foreign developers CapitaLand, GIC, HutchisonWhampoa, Kerry Properties, TishmanSpeyer
Retail Local developers Modern Group, Quanyechang,Wanlon, Yishang Group
Domestic
developers
CITIC, COFCO, Hisense, Pengxin,Tee Mall, Wanda
Foreign developers CapitaLand, GIC, Hang Lung, Isetan
RDM, SM GroupResidential Local developers Hongze, Ningfa, Sunac, Tianfang
Group, Wanshun
Domestic
developers
Vanke, Beijing Financial Street , R&FProperties, China Merchants, Poly,China Resources Land, Beijing CapitalLand, Sino -ocean Land, Vantone,Gemdale
Foreign developers Hutchison Whampoa, Keppel Land,Kerry Properties, Sunway, Wharf,Yanlord
Industrial Local developers TEDA T&B holding
Domesticdevelopers Haier, Liando, ZTE
Foreign developers GLP, Goodman, Mapletree
Occupiers
Ofce Logistics and Shipping COSCO, K Line, Kuehne-Nagel,Maersk
Finance BNP, Deutsche Bank, JP Morgan,Samsung Property Insurance
Services Firms Deloitte, Jones Lang LaSalle, PwC,The Executive Centre
Real Estate Hutchison Whampoa, Sohu,Tishman Speyer
Retail Marts/CVA Carrefour, E-mart, Walmart,7-Eleven
Department Store Far Eastern, Isetan, Lotte, Parkson,Robbinz, Vans
Shopping Mall Aqua City, AEON, Hisense Plaza,Joy City
Industrial Food and Beverage COFCO, Nestle, Pepsi, Tinghsin,Yakult
Electronic Freescale IBM, LG, Motorola,Samsung
Daily Consumer Goods P&G, Unilever, UnicharmAuto Toyota, Volkswagen,Biomedical GSK, Novo NordiskPetrochemical Industry CNOOC, PetroChina, ShellNew Energy Gamesa, Vestas
Aviation industry Airbus, Air China, Boeing, Goodrich
Real Estate Dashboard
Market Size
Ofces Grade A (sq m) 308,000
Retail (sq m) 2,430,000
High-end Residential (units) 33,000
Market Activity
Ofce Vacancy Grade A (%) 25.0%
Retail Vacancy (%) 4.0%
Benchmark Values
Ofces Grade A Rents* (RMB/sq m/month) 150
Retail Sales Turnover (RMB/sq m/month) 2,200
High-end Residential Prices (RMB/sq m) 21,000
Note: Data as at 2012 Q4
* Grade A ofce rents refer to gross rent GFA including PM feeSource: Jones Lang LaSalle
Key Transactions
Investors
Bank of
Communications
Bank of Communications bought 35,000-sqm ofcespace and 10,000-sqm retail podium of Xinyinbuilding in Q2 2010.
Beijing FinancialStreet
Beijing Financial Street bought a 79,600-sqm mixed-use plot in central Tianjin in Q3 2011, at a price ofRMB 2.36 billion.
Poly and Sunac Poly Real Estate and a local Tianjin developer,Sunac Holdings acquired an 117,000-sqm plot indowntown Tianjin for RMB 2.99 billion in Q3 2011.
Beijing Bank Beijing Bank purchased the 21,000-sq m Block Cofce tower of Tianjin Metropolis in Q4 2011.
Preferred Freezer
Services
Preferred Freezer Services acquired a 40,000-sqm plot in Tianjin port to establish refrigeratedwarehouse in Q4 2011.
Parkson Parkson purchased a 45,000-sqm retail property enbloc for RMB 700 million in Q4 2011
Alibaba Group In Q2 2012, Alibaba Group announced plans to buildan e-commerce logistics centre in Tianjin WuqingDistrict, with a total investment of RMB 3 billion and aland area of 1,000,000 sq m.
Occupiers
PwC PwC leased 1,500 sq m in the Exchange Tower 2 inQ2 2011
JP Morgan JP. Morgan relocated to Tianjin World FinancialCentre and leased 700 sq m in Q2 2011
Forte Group Forte leased 1,500 sq m in Xinyin Building in Q32011
Huawei Huawei rented 1,850 sq m in Tianjin World Financial
Centre in Q4 2011 for relocationState Bank of
India (SBI)
SBI leased 550 sq m in Tianjin World FinancialCenter in Q3 2012 to open a branch in the city
18 Chinas City Winners
Real Estate Overview
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
19/24
Logistics
As one of the main logistics hubs in Northern China, the central
government hopes to develop Tianjin, and more specically the
TBNA, into an international logistics centre, taking advantage
of its geographic location along the coast and also riding the
wave of recent interest from international logistics developers
such as Gazeley and Mapletree. In order to improve the citys
logistics base, considerable policy and scal support have been
injected, with the government boosting its investment in Tianjins
infrastructure, including improvements to its port, airport, railwaysand an various expressways. It is also offering preferential
policies - Dongjiang Free Trade Port Zone, for example, offers
tax-free incentives and an efcient customs clearance capability.
Residential
Before 2004, local developers were the main players in the citys
residential market. Since then, however, the residential market
has become more diversied in terms of developers background,
product types and development areas. Most high-end residentialproperties are situated within the four major submarkets of
Central Tianjin: namely Heping District, Meijiang area in Hexi
District, the Old Town Area and the Olympic Center in Nankai
District. Along with increased unit availability, sales volumes
within the residential sector have increased. Local residents who
are purchasing properties mainly for their own occupation or
upgrades are still the main contributors to demand.
Ofces
The dominant sectors driving absorption in the Tianjin ofce
market are nancial, professional services, trading, manufacturing,
and shipping and logistics companies, with average space leased
in the region of 400-700 sq m. Grade A ofce properties are mainly
occupied by leading MNCs and well-known domestic companies,
while domestic SMEs, attracted by lower rents, are mostly
clustered in Grade B buildings. Due to a lack of available space
and deteriorating qualities in their existing buildings, an increasing
number of companies are preferring to select new and better-quality ofce buildings for expansions and upgrades. Upgrades are
becoming a major force behind Tianjins ofce leasing activities.
Retail
Retail development in Tianjin has historically tted into
three categories: department stores in traditional shopping
destinations, hypermarket-anchored community centres and
street-front shops. Until recently, domestic brands, particularlyapparel brands, have dominated the retail scene. However, over
the last few years, in tandem with the opening of new shopping
centres, international retail developers and brands, eyeing
strong retail sales growth, have sped up their expansion into the
city. The shopping mall is now the retail category in the city,
accounting for roughly 87% of retail property completions (GFA)
by 2012, and is expected to heavily inuence the retail sector
over the next ve years.
Tianjin City Prole 2013 19
Jones Lang LaSalles View
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
20/24
20 Chinas City Winners
Logistics
Continues to benet from Tianjins manufacturing base
It was not until 2007 that Tianjins logistics market started to witness
any notable increase in new supply, boosted by the arrival of a
number of international logistics developers including Gazeley, GLP
and Mapletree, and their involvement in some signicant projects.
These and other international players have not only brought higher
construction standards, but also new and more comprehensive
logistics services; furthermore, the healthy competition among
developers and 3PLs is encouraging an improvement in market
transparency and accelerating the maturity of Tianjins logistics
market.
Compared with cities like Shanghai and Beijing, Tianjins good
transportation infrastructure, its accessibility to other major cities
and, most importantly, its lower industrial land and operation costs,
are key factors contributing to the citys attraction for logistics
developers.
Logistics demand in Tianjin is being generated from companies
serving the major manufacturers in industries like petrochemicals,
electronics and automotive, and also from retail related players.
In particular, e-commerce enterprises, especially B2C or online
shopping, are hitting record sales levels in China, and as with other
cities are generating strong demand for the logistics sector in Tianjin.
Overall, low vacancy rates and increasing demand for non-
bonded space continues to boost the growth of non-bonded rental
property which has outperformed that for bonded projects. Several
well-known international logistics developers and investors are
continuing to seek opportunities to acquire land for new logistics
facilities, and although they are primarily focused on Tianjins core
economic development areas such as TEDA, Xiqing District andthe airport area, increasing land scarcity and difculties negotiating
with governments, now mean that they are extending their search
across the region. After several months of negotiation with local
governments, a few agreements were nally settled in 2012, and
these new non-bonded projects will ease the t ight supply situation
over the next several years.
Ofces
Domestic rms are the main driver for ofce space demandThe Tianjin ofce market has grown in size and geographic reach over
the past ve years, albeit from a low base. Within the central city, its
four major ofce submarkets - Nanjing Road, Xiaobailou, Youyi Road
and Haihe Riverside - are home to the prime ofce buildings and key
MNC and domestic tenants.
Nanjing Road continues to be the primary and best-performing
Grade A ofce submarket due to its central location, mature
environment and convenient access to various transport modes.
Xiaobailou, an older submarket of Grade B ofce buildings, is
mostly occupied by domestic trading, real estate, and shipping
and logistics companies.
The Youyi Road submarket is mainly occupied by domestic
nancial companies.
Haihe Riverside is an emerging ofce submarket, particularly
with the opening of the TWFC (Tianjin World Financial Centre).
It is projected to see further signicant real estate activity in the
next few years, particularly with a large portion of the citys future
projects through to 2015 being concentrated in this area, due to
active government promotion.
Submarket Nanjing Road Xiaobailou Youyi Road HaiheRiverside
Key Features Tianjins CBD An oldersubmarket,seeingadditional
new
development
Financial-focused
submarket
An emergingofcesubmarket
Key Occupiers Multinationalnancial andprofessional
services
companies
Domestictrading andshipping& logisticscompanies
as well as
real estate
enterprises
Domesticnancial andreal estate
companies,near to city
governmentofces
Financial,professional
services,and shipping& logisticscompanies
Asset
Characteristics
Primary
Grade
A ofcesubmarket,direct subway
connections
Grade B
ofcesGrade B
ofcesFuture
Grade Aofcesupply
clustered
here
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
21/24
Tianjin City Prole 2013 21
The completion of TWFC has added 205,000 sq m of ofce space
to the market, effectively tripling the volume that had existed over
the past three years to a total Grade A ofce stock that now exceeds
300,000 sq m. TWFC has therefore provided much needed space
for tenants who, previously, had little space to expand.
Overall, domestic rms are providing the strongest leasing demand
in the Tianjin market, while MNC and domestic nancial institutions
and professional services rms have driven demand for Grade A
ofce space as they seek to open branch ofces in Tianjin as the city
expands as a nancial centre for Northern China. Likewise, as the
city develops as a logistics hub, shipping and logistics rms along
with trading companies have also provided a steady demand forofce space. Most companies preferences are for new buildings to
meet their expansion and upgrade requirements.
With the arrival of high specication projects, and given high
occupancy rates in existing projects, average ofce rents grew by
4.4% in 2012 to stand at RMB 127 per sq m per month. Future
rental growth will depend upon how tenants perceive the quality and
location of new projects. There is currently a lack of wholly-owned
and well-managed ofces to choose from, and most buildings are
sold as strata-title thus restricting the type of space sought byMNCs.
A mixed outlook for 2013-2015
Over the next few years, Central Tianjins ofce stock will
substantially grow in size, but most buildings will be sold strata-title,
as many developers either need funds or lack condence in the
market. The Tianjin Binhai New Area will potentially add a large
amount of new space; however, most observers dont expect this
supply to impact Central Tianjins market. If the economy, and
especially the service sector, continues to grow strongly, there could
be a signicant increase in demand for ofce space, helping to boost
rental growth, despite large amounts of space being completed
both in the city and the TBNA. The nal outcome is less than clear
and will depend both on how developers approach the market and
the level to which occupiers are concerned with the ownership and
operational structure of new buildings.
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
22/24
Note: Data as at 2012 Q4
Source: Jones Lang LaSalle
22 Chinas City Winners
purchasers. The focus of these measures was to prevent residential
prices from rebounding. So far they have been effective, with prices
increases and overall sales activity being relatively muted.
Looking forward, Tianjin is one of the fastest expanding cities in China
in terms of its population growth, and given this and an anticipated
strong local demand from residents for purchasing units for their own
use, we believe that the outlook for Tianjin residential market remains
one of stability, with an upward trend over the longer term.
Retail
New completions bring a more sophisticated shoppingenvironment
Prime-quality retail projects are currently distributed in six submarkets
of Central Tianjin: Binjiang Avenue and Heping Road (pedestrianised
streets), Nanjing Road, Xiaobailou, Youyi Road and Old Town Area.
While Nanjing Road and the pedestrianised streets are still considered
to be the premier retail precincts (with the highest footfall), the Old
Town area, with three new shopping centres opened in 2011 and an
upcoming Parksons Department Store (totalling 275,000 sq m), is
quickly emerging as a major retail submarket as it attracts a greater
share of retail trafc.
International developers and operators such as Lotte Group from
Korea, SM Supermalls from the Philippines, and Hang Lung and
Hutchison Whampoa from Hong Kong, have all entered the Tianjin
retail market, introducing a number of large-scale shopping centres
that feature imaginative designs and layouts. As a result, shopping
centres with a more comprehensive retailer mix are beginning to make
up a larger proportion of the market, compared to older traditional
department stores that, for example, provide limited food and
beverage facilities.
Since 2007, international retailers such as, Zara, H&M, C&A, Louis
Vuitton, Chaumet, Salvatore Ferragamo and Bottega Veneta, have
been drawn by Tianjins strong spending power and growth potential,
and have made their debuts in different projects in the city; this has
elevated pre-commitment rates in most of the new retail malls.
The markets incumbent players are now shifting their focus into
enhancing the shopper experience and, as a consequence, Tianjins
retail offer is beginning to catch up with its economic development
trajectory.
Residential
Greater product diversication
The 1990s saw relatively few high-end residential projects emerge in
Central Tianjin, but, since 2004, the residential market has boomed
in terms of construction and price growth. After several years of rapid
development, the market has evolved and matured; once dominated
by local players, its composition is gradually changing as more large
domestic and foreign developers launch projects, such as Poly, Kerry,
Hutchison Whampoa and Yanlord.
Supply
High-end residential stock (units) 33,000
Demand
High-end residential sales rate 64.0%
Asset Performance
High-end residential capital values (RMB/sq m) 21,000
Greater product diversication is also emerging as many of these
larger developers begin to bring various types and sizes of units to
the market. For example, Hutchison Whampoa has launched thedevelopment of three high-rise residential towers in their mixed-use
project, Metropolitan Heights, along Nanjing Road. The project aims to
differentiate itself with several rooftop villas and a large outdoor green
space on top of its retail podium. Tianjin Metropolis, developed jointly
by Beijing Financial Street and Poly Real Estate, is another example,
introducing a 646 sq m t-out unit per oor to the market; given the
large average size of each, they remain, to date, the largest residential
units for sale in the citys high-end residential market.
Although Tianjins residential market has seen rapid growth since
2004, demand has kept pace with supply, indicating the strong
market acceptance of high-prole residential projects. Local residents
purchasing residential properties mainly for their own-occupation
or for upgrading will still be the predominant driver of demand. The
steady demand for owner-occupation indicates that Tianjins high-end
residential property market is healthy yet not overheated.
With a sharp increase in capital values for the citys residential
properties during 2009-2010, the local government in tandem with
the central government started to issue tightening measures from
Q1 2011 to control sales prices. Under the new regulations, tightercontrol was enforced on purchasing rights and nancing options for
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
23/24
Contacts:
Contacts:
Rosemary Feenan
Director of Global Research Programmes
Jones Lang LaSalle
+44 20 3147 1198
Jeremy Kelly
Global Research Programmes
Jones Lang LaSalle
+44 20 3147 1199
Jones Lang LaSalle is the number one real estate research provider
in Asia Pacic. A team of 100+ researchers are committed to
providing best-in-class market knowledge that enables clients to
optimise real estate strategies and mitigate risks. Our award-winning
research includes the agship Asia Pacic Property Digest (APPD)
and industry-leading Real Estate Intelligence Service (REIS).
www.ap.joneslanglasalle.com/researchhub
Jones Lang LaSalles World Winning Cities programme is a
multi-year research initiative designed to draw together the essence
of contemporary city competitiveness and to predict the future city
winners and losers across the globe. The programme examines
trends that will impact on the business and economic landscape and
how they are coalescing to create the rising urban stars of the next
decade. It is unique in assessing the contribution of real estate to
sustainable competitive advantage and the implications for investors,developers, corporate occupiers and city governments. World
Winning Cities Research goes beyond description to uncover the
why of city real estate market dynamics.
www.joneslanglasalle.com/worldwinningcities
www.joneslanglasalle.com/China50cities
Jones Lang LaSalle Research Asia Pacic
Michael Hart
Managing Director of Tianjin
+86 22 8319 2233
Dr Jane Murray
Head of Research
Jones Lang LaSalle, Asia Pacic+852 2846 5274
Michael Klibaner
Head of Research
Jones Lang LaSalle, Greater China
+852 2846 5276
Stefanie Zou
Strategic Consulting, Tianjin
+86 22 8319 2233
World Winning Cities
Tianjin City Prole 2013 23
-
8/13/2019 WWC TianjinCityProfile Nov13 Eng
24/24
COPYRIGHT JONES LANG LASALLE IP, INC. 2013
Thi bli ti i th l t f J L L S ll IP I d t t b i d d d t itt d i f b ith i h l i t ith t th i itt
To find out how Jones Lang LaSalle can assist you in making real estate decisions in China contact:
Jones Lang LaSalle Greater China Offices:
Jones Lang LaSalle Regional Headquarters:
London
22 Hanover SquareLondon W1S 1JAUnited Kingdomtel +44 20 7493 6040
Chicago
200 East Randolph DriveChicago IL 60601USAtel +1 312 782 5800
Singapore
9 Rafes Place#39-00 Republic PlazaSingapore 048619tel +65 6220 3888
Michael Hart
Managing Director of Tianjin
Unit 3509The Exchange Tower 1189 Nanjing RoadTianjin 300051, Chinatel +86 22 8319 [email protected]
Kin Keung Fung
Managing Director of Greater China
6/FThree Pacic Place1 Queens Road EastHong Kongtel +852 2846 [email protected]
www.joneslanglasalle.com.cn
Beijing
11/FChina World Tower1 Jianguomenwai AvenueBeijing 100004, China
tel +86 10 5922 1300fax +86 10 5922 1330
Chengdu
30/FTower 1, Plaza Central8 Shuncheng DajieChengdu 610016Sichuan, China
tel +86 28 6680 5000fax +86 28 6680 5096
Chongqing
2501A-2506Metropolitan Tower
68 Zourong Road, Central DistrictChongqing 400010, China
tel +86 23 6370 8588fax +86 23 6370 8598
Guangzhou
Room 2401-03, 24/F Main TowerGuangzhou InternationalFinance Center5 Zhujiang Xi RoadZhujiang New Town
Guangzhou 510623Guangdong, China
tel +86 20 2338 8088fax +86 20 2338 8118
Qingdao
Unit 22AQingdao InternationalFinance Centre59 HongKong Middle RoadShinan District, Qingdao 266071Shandong, China
tel +86 532 8579 5800fax +86 532 8579 5801
Shanghai
25/FPlaza 66, Tower 21366 Nanjing Road WestShanghai 200040, China
tel +86 21 6393 3333fax +86 21 6393 3080
Shenyang
1808Ofce Tower, LAvenue10 Huigong Street, Shenhe DistrictShenyang 110013Liaoning, China
tel +86 24 3109 1300fax +86 24 3109 1330
Shenzhen
Unit 3808Excellence Times Square4068 Yitian Road, Futian DistrictShenzhen 518048Guangdong, China
tel +86 755 2399 6138fax +86 755 2399 5138
Tianjin
Unit 3509
The Exchange Tower 1189 Nanjing RoadTianjin 300051, China
tel +86 22 8319 2233fax +86 22 8319 2230
Wuhan
Unit 3202-03Corporate Centre 51628 Zhongshan AvenueJiangan DistrictWuhan 430014, Hubei, China
tel +86 27 5959 2100fax +86 27 5959 2144
Hong Kong
6th FloorThree Pacic Place1 Queens Road EastHong Kong
tel +852 2846 5000fax +852 2845 9117www.joneslanglasalle.com.hk
Macau
Unit H, 16/FFinance and IT Center of MacauNam Van Lake Quarteirao 5 Lote AMacau
tel +853 2871 8822fax +853 2871 8800www.joneslanglasalle.com.mo
Taiwan
20/F-1
TAIPEI 101 TOWERNo 7 Xinyi Road Section 5Taipei 11049, Taiwan
tel +886 2 8758 9898fax +886 2 8758 9899www.joneslanglasalle.com.tw