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CBRE: Urban renewal is an important issue in megacity governance

author:21st Century Business Herald

21st Century Business Herald reporter Li Guo reported from Chengdu

On October 27, CBRE released the CBRE White Paper on Urban Renewal in Chengdu and held a seminar to interpret and exchange urban renewal development in the 14th Five-Year Plan period.

The background is that after the urbanization rate exceeded 60%, urban development changed from large-scale incremental construction in the past to a stage of equal emphasis on stock quality improvement and incremental structural adjustment, and in 2021, "urban renewal" was also written into the government work report for the first time.

Xie Ling, managing director of CBRE Southwest District, told 21st Century Business Herald that urban renewal will be an important topic in the process of megacity governance. Different from the well-known population management and equalization of public services in the past, urban renewal can solve the problem of population and industrial hollowing out of the old city, reshape the competitiveness of the old city, and thus promote the improvement of the competitiveness and governance ability of the entire city.

<h4>The connotation of urban renewal has changed dramatically</h4>

Chen Xuehai, head of the Strategic Advisory Department in China, believes that compared with Western European countries, China's urban renewal has gone through three stages. The first phase of the period is the longest, from 1949 to 2011, and its main feature is that it is centered on economic construction, and urban renewal takes the promotion of economic development as the primary goal. Serve the construction of socialist industrialization and accelerate the process of urbanization to achieve a rapid increase in the urbanization rate. Among them, the renewal of cities can be subdivided into "urban reconstruction", "urban rejuvenation", "urban redevelopment in the post-industrial era" and "improving the functions of consumer-oriented cities".

The second phase runs from 2012 to 2019. With the beginning of the transformation and upgrading of the domestic economic structure, China has completed the initial exploration of urban renewal from "quantity" to "quality" in less than 10 years, the transformation of production relations and lifestyles into urban renewal has given new connotations, and urban renewal has moved from focusing on the "spatial renewal" of demolishing the old and building new ones to the renewal of content.

The third phase has continued from 2019 to the present. Chen Xuehai believes that as the domestic urbanization rate exceeds 60%, when it enters the second half of "urbanization", China's urban renewal will also serve the goal of comprehensively building a socialist modern country, and carry out comprehensive renewal with people as the core, more diversified, multi-dimensional, and larger overall planning.

Chen Xuehai said that the development and evolution of China's urban renewal is closely related to the introduction of a series of national policies, such as the paid transfer of land use rights, housing commercialization reform and other policies to promote the transformation of China's urban renewal development stage and development model. On the other hand, due to the different stages and speeds of urbanization process in Various Cities in China, there is also a big gap between the foundation of economic development and the focus on the material and spiritual needs of the people, and various localities have formulated implementation plans for local characteristics on the basis of national policies to achieve the development of the city, reflecting the regional characteristics of China's urban renewal. Therefore, in the process of urban renewal implementation, whether it is local governments or urban operators, they cannot blindly copy the experience of other cities.

"People living in cities, how to relate to urban renewal, this is a problem that needs to be solved, in the past, urban residents were passively waiting for demolition and getting the opportunity to improve their quality of life, but the demolition of old cities cannot solve the hollowing out of industry and population." Liu Yin, Director of the Strategic Advisory Department of CBRE Chengdu, believes that "urban renewal requires both production and lifestyle, through the diversification of production, to provide more employment opportunities, and at the same time to meet the more diversified needs of the city through the increase in the per capita share of public resources such as medical care and education." ”

<h4>Urban renewal is part of urban governance</h4>

On September 25, the 2020/2021 China Urban Planning Annual Conference and the 2021 China Urban Planning Academic Season were held in Chengdu. Huang Yan, vice minister of housing and urban-rural development, said at the meeting that urban renewal is not an urban construction action in a broad sense, but should be understood as an urban governance action.

At the end of August, the Ministry of Housing and Urban-Rural Development also issued a document saying that the implementation of urban renewal actions should prevent large-scale demolition and construction, and required to maintain the scale of the old city pattern and continue the characteristics of the city.

This is considered to be an important signal that China's urban renewal has moved towards a new era, at present, Shanghai, Beijing, Shenzhen, Chengdu, etc. in the domestic megacities have taken the lead in the practical implementation of urban renewal projects, and formed a corresponding personalized development model.

According to the CBRE White Paper on Urban Renewal, several megacities in China have carried out early exploration of urban renewal. For example, Shanghai focuses on the guidance, renewal and management of social relations to achieve leading innovation in renewal mechanisms and paths; Beijing takes "strict control of increment and revitalization of stocks" as the guiding ideology to form a "pluralistic co-governance" created by top-level design and grass-roots level; Shenzhen emphasizes flexible renewal, guides market-oriented operation through innovation of incentive policy mechanisms, and realizes the full participation of multiple subjects.

Chengdu's urban renewal is characterized by "benefiting the people and increasing greenery and operating in partnership", and adheres to the principle of people-oriented renewal. In 2021, Chengdu issued policy documents such as the Ten Major Projects for Building a Happy and Beautiful Life and the Ten Major People's Livelihood Facts, taking the wisdom of the masses as an important basis for the formulation, project implementation and promotion of various policies in the organic renewal of the city, emphasizing co-construction, co-governance and sharing, and promoting "Happy Chengdu" to be warmer, more textured and more connotative.

Xie Ling said that Chengdu combines and cultivates new industries and new formats by "staying and rebuilding" to retain urban genes and fireworks to the greatest extent and boost the momentum of urban development.

On the other hand, urban renewal has also changed the past developer's "fast-in, fast-out" operating model, and local cities have also increased the "project operation" ability assessment of developers between the traditional model of "demolition and construction".

Therefore, compared with the transformation of the old city, the threshold for developers to enter the "urban renewal" is constantly increasing, and the government will also face the huge problem of capital expenditure in the process of urban renewal.

Liu Yin said that in the future, the funding side of urban renewal may change, in addition to government funds and traditional real estate with operating experience, insurance funds that do not emphasize high turnover of funds may also enter this field.

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