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Beijing, for the first time, transferred the right to develop land through the public listing process at the weekend.
The move is aimed at producing a level playing field for land deals in the capital and increasing public access, particularly for land dealers outside Beijing, an analyst said.
The successful buyer of the 1.13-hectare site in the core of western Zhongguancun, widely known as the Silicon Valley of China, was the Beijing branch of a Taiwan-listed group.
It paid 270 million yuan (US$32.6 million) for the right to develop the land. It is understood that the site will be used to build exclusive apartments.
According to an expert from the Chinese Academy of Land and Resources Economics, the successful transaction opens up opportunities for real estate developers from outside Beijing who want to participate in the large-scale urban upgrading of the nation's capital.
Sun Xiwen said before the landmark listing, non-Beijing-based developers were daunted by the land disposal administrative system.
Sun said local developers took advantage of the situation because they were more familiar with the operations of local authorities. Public listing allows the owner of the right to develop land to negotiate with potential buyers when there is more than one group offering the same price.
"Although the negotiation leaves room for connections to play a decisive role, the practice of public listing still allows more chances for outside real estate developers in Beijing," Sun said.
His opinion reflects a report from the Beijing Morning Post, which quoted a person from the Taiwan-funded company. They were worried about competitors during the 10-day public listing period.
Under municipal regulations, the right to develop land that is comparatively smaller and of a lesser value should be publicly listed. All other land rights are settled by the public bidding process. The Zhongguancun site was listed at the Beijing Municipal Land Transaction Market.
(China Daily August 26, 2002)
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