By Andrew Calvo
Over the last five years the global economic downturn has affected residential and commercial development in every part of the world except one: China. China has been one of the few places in the world wher construction has shown an increase during this time frame. The governmen- funded construction projects do not consist of a few large high-rise buildings in downtown business districts, nor does it consist of small or even large housing developments in the suburbs; I’m also not referring to large public works projects such as dams or high-speed railroads however these construction projects are cities -entire cities. Cities that are designed to hold millions of citizens when completed and consist primarily of high-rises and huge civic buildings as their center. These new constructions are cities with literally multiple thirty or forty-story high rises being built in mirror images of each other and complete with government centers, financial districts, retail centers and plenty of open space for citizens to enjoy. These cities are being built at a rapid rate; and some are half the size of Manhattan and are constructed multiple times a year throughout the country. It’s been speculated that China plans to build an additional twenty cities a year for the next 20 years; although that number has been lowered to 10 cities a year as a way to “slow down growth”. So who is actually moving into all of these cities? Sure, china is the most populous country in the world with 1.3 billion people in 2010 according to the World Bank, but can these cities sustain this much growth, ensuring that families move in and occupy the buildings and shop in the retail centers?
A lot of these cities are literal Ghost Towns, either halfway finished or finished with only a few hundred residents in a city built for a few hundred thousand, or even millions of residents. These cities have names, such as Ordos, Shang Wu Nei Huan Lu, Ernest, Xinyang, or Dantu to name a few. Some names begin with “new” as to preface that it is replacing an older city of the same name, but one thing has stayed the same; no one has moved in yet. Is it to keep employment high? Real estate speculators able to finance with inexpensive government debt? Is the governments planning to move millions of people from poor impoverished rural areas to more densely populated cities? Units in some cities are being sold for $80,000 (USD), and in comparison to prices in Manhattan may be a steal, but for the average chinese worker who makes under $2,000(USD) a year – a nice apartment in the city may be completely unattainable. So what exactly is the purpose of this city building? No one really knows, the Chinese government isn’t the most transparent in letting their motives be known, so we may never find out for years. But if you are looking for a good priced penthouse apartment overlooking a city with very little traffic, there are probably a few places in China to look at.
Want to see more pictures of these Chinese Ghost Cities?
My Map on Google Maps (Zoom in on points)
Andrew Calvo is a first year M.S. Candidate in Real Estate at NYU Schack Institute, he lives in New Jersey and upon graduation is looking to go into commercial and hotel development/acquisitions. He also writes for his own blog at PassionsOfAZealot.com.