Beijing Scene, Volume 5, Issue 3, April 2 -8
The Real Deal
Survival Guide to Beijing Real Estate

The old Peking of grey stone walls and narrow alleyways bears little resemblance to the 21st century metropolis that is Beijing. The city walls were dismantled in the 1960s and three decades later, the hutongs and neighborhood courtyards of the city center are rapidly disappearing before the onslaught of Beijing’s real estate boom. The oft-sighted character 'Chai' ("demolish") painted on the walls of many remaining traditional courtyard homes signifies the imminent destruction of yet another relic.

The predominant feature of new Beijing’s cityscape is the construction crane. Foreigners arriving in the city for the first time may not realize that this growth is a recent phenomenon. A major policy change in 1992 provided overseas investors with preferential incentives to invest in what soon became the world’s most expensive rental market. Foreign residents and companies were previously restricted to an extremely limited number of hotels and office complexes, but by late 1994 a surge of new buildings began flooding the market.

Today, supply clearly exceeds demand. Beijing now ranks third globally (behind Shanghai and Beirut) in the vacancy rate for commercial space. Prices, which peaked in mid-1996, have fallen by 50 percent across the board. While the rate of decline slowed by late 1998, a further drop appears inevitable for 1999. Nonetheless, the capital still offers the most stable real estate market in China. Restrictions on the availability of permits for new projects, as well as the high costs involved in relocating land-right holders, upgrading infrastructure, and importing construction equipment and materials continue to exert upward market pressure.

Upmarket villas (detached, single family homes) and apartments still command outrageous prices but there is more choice now than there has ever been. If your company is willing to pay upwards of US$10,000 per month in rent, then you have plenty of options. On the other end of the scale, more and more local apartments are available to foreigners as government controls become increasingly lax. Whether your priority is finding a friendly neighborhood where your children will have fresh air and green space in which to play or one that jumps with late-night jazz joints, Beijing can accommodate you. As in any major city, both the residential and commercial markets span the spectrum of quality, price and location.

Villas offer a popular choice for expatriate families with children, pets, cars, and dreams of recreating in China the life they had back home. Most of these developments are situated in Chaoyang District or along the roads northeast of town, past the airport. While the commute to work may be longer, villa life generally offers cleaner air, landscaped communal gardens, and community playgrounds and clubhouses.

Villas are available for rent or purchase. Depending on size, location, reputation and facilities, rents range from US$1,500 to US$12,000 per month. Purchase prices run anywhere from US$250,000 to the millions. Painted cement walls, hardwood or marble floors, and tiled kitchens and bathrooms are standard. Materials tend to be either imported or products of joint ventures. Facilities may include swimming pools, tennis courts, fitness centers, supermarkets, restaurants, daycare facilities and the ubiquitous karaoke. Shuttle bus service to and from town and international schools is standard.

Legend Garden
Lijing Huayuan Bieshu
Tel: 6456-1133/6456-1150
Legend started it all. When the first batch of homes sold for upwards of US$600,000 in the early 1990s, scores of other developers rushed the gates of the capital’s permit purveyors. Today, a mature community exists there with a range of detached and semi-detached homes, apartments, facilities, and a stable occupancy rate. Located adjacent to the airport, monthly rental prices range from US$6,000 to $6,500.

Beijing Riviera
Beijing Xiangjiang Huayuan Bieshu
Tel: 6435-1388
Riviera is a large, very upscale community located just off the Airport Expressway on Jingshun Road. The massive clubhouse was completed in 1998 and a Montessori School will be added this year. A Spanish exterior motif runs throughout the complex, which includes gardens, a lake and apartments. Villa rentals begin at US$6,000.

River Garden
Huayuan Bieshu
Tel: 8046-1056/6466-5668/6466-9928
One of the more established villa communities in the capital, River Garden is located about 10 minutes past Beijing Riviera on Jingshun Road. It offers a residents’ association, a fully functional community center, and plenty of kids playing in the neighborhood. The California-style homes feature high ceilings and run from US $3,500 to US$11,000.

Capital Paradise
Mingdu Yuan
Tel: 8046-1582
Located next to River Garden on the Wenyu River, Capital Paradise has a wide selection of detached homes and townhouses, as well as several free-standing apartment buildings and a newly completed clubhouse. Capital Paradise came on the market about a year after River Garden and is only now beginning to fill up. Prices start at US$3,500.

Oulu Yuan
Tel: 8046-1400/8046-2776
Arguably the best built of the villa projects in Beijing (and backed by the only two-year warranty), Eurovillage is a German joint-venture located two minutes past River Garden on Jingshun Road. This is a smaller community, with 50 European-style homes in the first phase. Completion of the clubhouse facility is set for late spring, 1999. Rentals go for between US$5,500 and US$8,000.

Dragon Villas
Longyuan Bieshu
Tel: 6940-1226
Located 30 minutes from the Airport Expressway, Dragon Villas offers hundreds of homes from several construction phases, in addition to an extensive recreation center. The quality of the homes is quite good, but people choose Dragon because of the quality of life. With two golf courses within walking distance and miles of surrounding farmland, the air is cleaner and the living is easy - as long as you don’t forget something back in town. Prices range from US$4,000 to US$10,000.

Country Golf Club
Beijing Gao’erfuqiu Julebu
Tel: 6940-1390
If golf is your passion, this is your place. Residents here don’t need to walk to the golf course, they live on it. This is a smaller community, with only 55 villas. An indoor pool/health center was completed last year adjacent to the course clubhouse. Fishing, horseback riding and other recreational activities are available in the immediate vicinity. Rentals start at US$3,000 per month.

Woodlands Villas
Huazhong Yuan
Tel: 6940-1467/6940-1487
This development is located next to the golf course, with 93 European-style villas and a large clubhouse. Facilities include reception rooms, conference rooms, a function hall and a VIP lounge. Bowling, billiards, swimming, tennis, weightlifting and, of course, karaoke are among the recreational options. Prices range from US$2,500 to US$4,500.

East Lake Villas
Donghu Bieshu
Tel: 6467-8221
East Lake is the only villa community located in the heart of the Embassy District. A joint-venture with Swedish EAC, East Lake is a multi-use development, offering villas, apartments and office space. Facilities include a traditional Chinese pond and the East Lake Club (pool, gym, racket courts, etc.), as well as a supermarket, bank, post office and primary school. This is a well-established community with an experienced management team. Rental prices at East Lake begin at US$10,000.

Greenland Garden
Jialin Huayuan Bieshu
Tel: 6436-9551
Located near the Lido, Greenland is mainly a villa development, but also has two upscale apartment buildings. Clubhouse facilities include gym, squash and tennis courts, billiards, a children’s playground, outdoor swimming pool and two restaurants. Villas range from US$4,500 to US$11,000 per month.

King’s Garden
Jingrun Huayuan Bieshu
Tel: 6466-0890
King’s Garden is still being developed as a large, top grade villa community located between Lido and Lufthansa Center. Lake views are available within a stone’s throw of the third Embassy District. Prices begin at US$4,000.

The market for foreign-style apartments has transformed dramatically since a building spree began in the early 1990s. The surge in supply brought increased competition, resulting in significant value-added improvements. Quality in Beijing is defined not only by design, construction and furnishings, but also by the competence of the property management company. Restaurants, exercise facilities and shopping centers have become standard fixtures at most foreign complexes. Grinding competition has precipitated an overall 50 percent drop in average prices since the mid-1996 high water mark. Today, radical differences exist between what once were comparable projects. Occupancy rates are the clearest measure of success.
Three basic options stand out in the apartment hunt. Most residential buildings marketed to the expatriate community in Beijing are loosely referred to as "serviced apartments" because the management company cleans the hallways and collects trash. A second group is distinguished by the additional provision of linen, kitchenware and daily housekeeping services. These "hotel-style" serviced apartments have now become so numerous as to warrant separate mention. A third and increasingly popular option is found in the local Chinese market.

Hotel-Style Serviced Apartments
The original hotel-style serviced apartments in Beijing stem from the early days when foreigners were restricted to a few fancy hotels to which ordinary Chinese people were denied entry. Presently, two types of fully serviced apartments exist: those integrated with hotels and those built as wholly independent developments. The former group is more expensive, but usually offers a fuller range of amenities. Both types are occupied largely by busy professional expatriates on assignment in the capital for a limited duration. Residents tend to be single, and are therefore willing to trade size for more convenience in keeping with their busy lifestyle. Keep in mind that, like a hotel (but unlike a standard expatriate apartment) prices of these units generally include management fees and utilities.

The monthly prices quoted below are based on 100 square meters.

Asia Pacific
Yatai Dasha
Tel: 6513-9988
Located just east of the Second Ring Road and a five minute walk from Jianguomenwai Avenue, "Yatai" is a long-established property with a convenience store, business center, gym, and several local and foreign restaurants nearby. US$4,000.

Kaiwei Dasha
Tel: 6592-5188
Gateway is primarily a commercial building located across the street from Asia Pacific. The top three floors contain well-designed, serviced apartments managed by Singapore-based Regency. A Chili’s franchise restaurant and a new bar and restaurant are on the lower floors. US$4,000.

Jianguo Hotel
Jianguo Fandian
Tel: 6500-2233
The first hotel/serviced apartment complex in Beijing, from the days when foreigners basically were required to live here. Still a first-rate location with newly remodeled rooms, three restaurants, a swimming pool, business center - and opera performances in the lobby on weekends. US$4,500.

Landmark Apartments
Liangma Dasha
Tel: 6590-6688
One of the more established multi-use developments in town, the Landmark boasts two commercial towers, a hotel, a shopping mall and the Beijing Hard Rock Cafe. US$4,500.

Jingguang Center
Jing Guang Zhongxin
Tel: 6597-8888
The tallest building - and highest high-rise apartments - in Beijing. Jingguang is also home to a hotel and commercial space. Facilities include an indoor pool, gym, children’s play area, business center, self-service laundry and several restaurants. US$3,200.

Hong Kong-Macao Center
Gang Ao Zhongxin
Tel: 6501-2288
Located on one of the main East Second Ring Road bridges, the Swissotel offers one of Beijing’s finest health clubs to tenants, as well as a prominent hotel and commercial space. US$4,500.

Asia Hotel
Yazhou Dajiudian
Tel: 6500-7788
Located near the Swissotel, just off the Second Ring Road, Asia Hotel has a business center, a health and beauty salon and a night club. US$3,000.

City Hotel
Chengshi Bin Guan
Tel: 6500-7799
City Hotel has an excellent location across from Worker’s Stadium and within a few minute’s walk of Sanlitun with its abundance of shops, bars and restaurants with foreign customers. US$3,900.

New World Center
Xin Shijie Zhongxin
Tel: 6702-9902
This is a majestic looking multi-purpose facility with serviced apartments, offices, and a shopping center situated near the Second Ring Road at Chongwenmen. There is an indoor swimming pool, sauna, beauty salon, gym and simulated golf. US$1,800 and up.

Xidan Huawei
Xidan Huawei
Tel: 6602-5351
This is the only hotel-style serviced apartment located on the west side of the city. Situated on top of the Huawei Shopping Center at Xidan, the facility is complete with the standard amenities. US$4,200.

Hengchuan Apartments
Heng Chuan Gongyu
Tel: 6428-3858
Located near the International Exhibition Center and the Carrefour grocery and department store, Heng Chuan is relatively new, with an outdoor swimming pool, tennis, children’s playground, and a budding reputation for excellent service. US$3,500.

Standard International Apartments
This refers to international standard apartments that do not include hotel-style service in the rental fee. Much like apartment shopping in the West, choosing a space to call home in Beijing will depend largely on proximity to work, schools, shopping and fun - in whatever order you prefer. For this reason - as well as market competition - significant price-tiering has occurred over the past few years. Hardest hit by deflation have been the middle and lower-priced apartments, or those buildings that, due to poor location, design flaws, inadequate facilities or incompetent service, couldn’t compete. The upper market also finally experienced a price drop in late 1998. Prospective tenants should be sure to ask about hidden costs because almost everything is negotiable these days.

The below apartments are arranged according to price:
US$3500 and Up

Regent Court
Lijing Yuan
Tel: 6595-4561
Located directly on Jianguomenwai and within walking distance of several of the city’s main commercial centers, Regent is one of the premier properties in Beijing. Free use of standard clubhouse facilities is normally included with rental.

East Gate Apartments
Tel: 6415-6772/3
East Gate is an impressive newcomer, centrally located just behind Poly Plaza on the East Second Ring Road. A wide variety of Western-standard residential units are available, as well as an abundance of entertainment and cultural attractions within a dynamic, mixed-use complex.

China World Apartments
Tel: 6505-2288
When the China World Trade Center was built in the late 1980s it created the central business district of Beijing. Two blocks of 30-storey apartments, and no more waiting list.

Kerry Residence
Jiali Zhongxin
Tel: 8529-8383
Kerry is Beijing’s newest premier address, located directly behind China World. Though traffic on Guanghua Road may become a nightmare, Kerry Centre has it all.

Lido apartments
Lidu Gongyu
Tel: 6437-6688, ext 1258
The Lido used to pass for Beijing’s airport hotel and because it was so far out of town, they had to create things to do, hence the plethora of restaurants, conference rooms and facilities. The city has since expanded embracing the Lido and making it convenient for commuting.

Henderson Center
Hengji Zhongxin
Tel: 6518-3287
Located at the entrance to the Beijing Railway Station on Jianguomennei, Henderson is a multi-use complex with several new commercial centers, hotels, and shopping centers nearby.

Parkview Apartments
Jingyuan Dasha
Tel: 6438-9590
With views of both Chaoyang Park and the Chaoyang golf course, Parkview was aptly named. Located just minutes from both China World and the Airport Expressway, with full clubhouse facilities.

Lakeside Garden
Qingjing Minghu
Tel: 6538-1281
A new development situated just north of Parkview, across from Chaoyang Park. Nicely done, pricey and significantly less than full.

Sanquan Apartments
Sanquan Gongyyu
Tel: 6508-8883
Located just across the river from Lufthansa Center, the triple tower complex is best known for its outstanding clubhouse which has the largest swimming pool in town.

Diyang Apartments
Diyang Gongyyu
Tel: 6503-5611
Views of Ritan Park. The apartments are average (sunny on the upper floors), but you just might be able to walk to work.

Fairview Garden
Yijing Yuan
Tel: 6503-4693
Located just north of Diyang, Fairview currently offers two towers of three-bedroom units in varying sizes. Good quality and tight security.

International Friendship Garden
Guoji Youyi Huayuan
Tel: 6464-9703
A large, residential development situated near the Sanyuan (airport) flyover with wood floors, balcony windows and a well-equipped clubhouse.

Boning Garden
Boning Huayuan
Tel: 6594-5566 ext. 7297
Located behind the Sheraton Great Wall Hotel, Boning has twin towers and the expatriate basics.

Longbao Apartments
Longbao Gongyyu
Tel: 6507-5742
Longbao is near Boning, but offers a few more amenities, such as an outdoor pool, air ticket office, garden and fancy lobby.
US$1500 and Less

Greenlake Garden
Bihu Ju
Tel: 6538-2081
A lower priced alternative to Lakeside, Greenlake set the pace during the price wars of 1997 and 1998. Nice central garden and all the trimmings.

Songyu Apartments
Songyu Gongyyu
Tel: 6733-2166
Songyu is a glorified local building with expatriate status. Managed by the Jianguo Hotel, it is about 10 minutes south of China World on the East Third Ring Road.

Jindu Apartments
Jindu Gongyyu
Tel: 6762-0312
Jindu is another local building with an expatriate orientation. It is located in the Fangzhuang residential zone on the South Second Ring Road, just above Arcadia Bar.

Longtan Apartments
Longtan Gongyyu
Tel: 6711-5358
Longtan is located just behind the Tiantan tennis center on the south side of Beijing. It has all the basics, at just-above-local prices.

Local Chinese Apartments
Though the rules are still a bit vague, leasing a local Chinese apartment is an increasingly popular option for foreign residents in Beijing on a limited budget. To give yourself the best chance of making it "legal," check to be sure your landlord actually owns the unit (a good practice anywhere) and try to register with the police. As a fallback, determine if, and for how long, other foreigners have been living in the building. The authorities are much less concerned about where foreigners are living than in the past, although this year’s pre-June jitters have already led to a few foreigners being kicked out of popular areas like Maizidian.

Many agents carry listings for both local and foreign apartments. Currently, the difference is that agents for foreign dwellings get paid by the owner, while those for local apartments charge the tenant. Fees run as high as one month’s rent. What you get depends largely on what you’re willing to pay - though you can be certain you’ll get worse value than would a Chinese person renting the same property. Not only is it simply understood that foreigners are rich, the landlord may need some extra money to ensure that neighbors, bored grandmothers and local police are happy with the tenants. When looking at an apartment don’t hesitate to ask every question that comes to mind. Test all the taps, toilets, doors and windows. Write an agreement detailing price, duration of stay and responsibility for repairs. Many landlords expect payment of three to six months rent up front, plus a deposit, but this is becoming more open to negotiation as more areas open up to foreigners.

Once you move in, change the lock. Despite all assurances to the contrary, your landlord retained a set of keys. Don’t be unfriendly though: as an emissary from a morally deficient land, you will best diffuse your neighbor’s natural curiosity by showing a human touch. Cluck over infants, patronize the local convenience store, hold doors - even if it’s not a local habit - keep the late-night raves to a minimum, and smile a lot. Discretion is still best when mingling with Chinese members of the opposite sex. Non-conformity is met with a high degree of scrutiny, and your behavior is monitored under a high-powered microscope. Keep in mind that, as a guest, you are expected to adopt the habits and customs of your host. If you happen to look Chinese of course, you may escape all of this scrutiny entirely.

Traditional Courtyard Homes
The courtyard house (siheyuan) is a rapidly disappearing symbol of old Beijing. Opportunities to find one for sale or rent are rare, but before you wax nostalgic, remember the drawbacks. With the city planner’s demolition ball swinging toward Beijing’s hutongs, only officially protected courtyard neighborhoods are safe as a long-term option. Amenities such as 24-hour hot water and basics like indoor plumbing may be unavailable. Finally, the costs can be extremely high. Recent purchases have run in excess of US$1 million and rentals often exceed US$5,000 monthly. Deals may still be found, and as with everything else in China, the best method is networking.

Commercial Real Estate
The rental market for international quality office space in Beijing is continuing to soften. It’s a buyer’s market and landlords are aggressively seeking tenants. Incentives, such as longer rent-free periods and large fitting-out subsidies, are commonplace. This year marks the opening of several major new projects, like the Kerry Center and Onward Science, near China World, and Pacific Century Place in Sanlitun. With supply still on the increase, the Asian economic crisis still lingering, and an increasing number of companies opting for Shanghai, local Chinese companies will have to take up most of the slack if vacancy rates are to drop during the next few years.

While the pace of decline in Beijing office rents slowed toward the end of 1998, the market still had a 20 percent price drop for grade ÔA’ commercial space. Monthly rents now range from US$10 to US$40 per square meter. Even the Teflon buildings, like China World and Jingguang, got stuck in the quagmire of falling rents and vacancies.

Kerry Centre
Jiali Zhongxin
Tel. 8529-8383
A new landmark for the capital, Kerry Centre is equipped with state-of-the-art communications technology for the high tech set, and is centrally located behind China World.

China World Trade Center
Guomao Dasha
Tel. 6505-2288
Ever since its completion, China World has been the most prestigious business address in Beijing. A twin commercial tower and an upscale shopping mall are under construction.

Hanwei Plaza
Hanwei Dasha
Tel. 6561-1155
Another major office complex squeezed onto Guanghua Road, Hanwei was one of the first grade 'A’ buildings to slash and burn prices. Several major multinationals grabbed long-term deals in the process and the towers filled up.

Bright Changan
Guanghua Changan Dasha
Tel. 6510-1100
One of the new commercial centers on the prestigious Jianguomennei section of Changan Boulevard, Bright Changan claims 100% occupancy for both towers, though one can still find a vacant unit through a private owner.

Zhongliang Guangchang
Tel. 6526-6666
Located next to Henderson Center, also at Jiannei, COFCO is as full as Bright Changan, but has the added attraction of a major shopping mall, complete with a Park Ôn Shop and a new Starbucks.

Full Link Plaza
Fenglian Guangchang
Tel. 6588-1997
Despite its location next to the Foreign Ministry, it feels just like Hong Kong inside Full Link, with a multi-level shopping mall and glass and steel commercial tower.

Henderson Center
Hengji Zhongxin
Tel. 6518-3228
The centerpiece of the Jiannei business district, Henderson has two office towers, a residence building, a major shopping center, and the Universal Studios video wall.

Jingguang Center
Jingguang Zhongxin
Tel. 6597-8888
Jingguang is the tallest building in Beijing. The offices are located between the 25th and 37th floors, with a five star hotel below and serviced apartments above.

Pacific Century Place
Yingke Zhongxin
Tel. 6586-7888
A brand new, multi-use complex located next to Zhaolong Hotel in the heart of Sanlitun, Pacific Century is another top grade project just beginning the fight for tenants.

Lufthansa Center
Yansha Zhongxin
Tel. 6465-4488
One of the earlier commercial centers in town, Lufthansa is attached to the Kempinski Hotel and the Yansha Friendship Shopping Center.

Silver Tower
Nanyin Dasha
Tel. 6410-6003
Located on the Sanyuan flyover, Silver Tower offers one commodity - offices.

Thanks to Pan Asia, China Solutions, and FPDSavills for contributing to this article.

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