More land for service sector in Shanghai FTZ mulled

Authorities in the China (Shanghai) Pilot Free Trade Zone are considering altering the planning of land use to boost land supply for companies in the test field.

Dai Haibo, deputy director of the FTZ administration committee, said at a news conference on April 22 that idle land parcels in the 28-sq-km Shanghai FTZ, mostly of which were designed for industrial uses such as warehouses, would be "redeveloped" to be applicable to more functions of the FTZ.

Newly registered companies have been keen to find an office since the FTZ was launched in September, pushing up office rentals. "An initial plan is for the land to be used for comprehensive purposes, such as foreign trade, finance and logistics, mostly the modern service sector," he said.

Detailed conditions for the redevelopment will be released soon, and owners of industrial land in the FTZ will be able to build commercial buildings after paying the price gap for the different land use, Shanghai Securities News reported, citing sources close to the matter.

Observers said the land value would rise 30 to 50 percent after "redevelopment" for it could be used for high-rise office buildings, but they also warned that landowners would keep the land off the market due to higher prices, resulting in even less supply.

Local Bureau of Land and Resources said in October that FTZ administration committee would have much independence on this matter, while FTZ authorities said they were considering changing 80 percent of the industrial land into commercial use.