What a day!
This is a not completely-normal normal day. It is not normal, since my typical working day is in office. It is also normal, since this is a typical day in Shanghai. Let me tell you what exactly the life here looks like – since many people didn’t get the change to visit Shanghai yet. Today, I am visiting several places in the Lujiazui area.
The hotel of Shangri-la is still having a good business. The UBS Greater China Conference 2008 was going on in many floors of the hotel. So many people with black suits and ties attended. Well. Business meeting of a wealth bank is much more luxurious than a meeting of Internet company.
From Shangri-La to Jin Mao Tower
I admit that I haven’t been to the Lujiazui area for a long time. To my surprise, many new buildings appeared. By “new buildings”, I mean those skyscrapers higher than 40 floors, or something around 200 meters.
Side by side with Shangri-la, is the Hopson International Tower. I don’t know when they started construction, but it seems to be opened to public soon in 2008. Behind it is another tower as high as the CITI Bank Tower.
Turning the corner, is the new twin tower (260m) of Shanghai IFC (International Financial Center), or with the new name – HSBC Building, Shanghai IFC. In the same tower are the Ritz-Carlton hotel (second in Shanghai), and the W Hotel (first in China). It is to be completed between 2009 to 2010.
Meeting in Jinmao Tower
The meeting in the afternoon is in the Jinmao Tower. We talked about the office rent price. Compared to the office building of 3.8 RMB or 0.5 USD per sq. meter per day, I guess the price of Jin Mao must be high. I am right. It is more than 1 USD per sq. meter per day. My host told me that the World Financial Center on the other side is asking for pre-leasing price of 3.3 USD per sq. meter per day.
It was a law firm, and they are expanding rapidly. Their staff is working days and night (seriously, till 2 AM sometimes) but still cannot meet the demand. With more and more office buildings and the moving-in companies, I can see their business must keep growing.
The other side of Jin Mao
When I stepped out of the busy Jin Mao Tower, I realize the restaurants on the other side of road were already closed, and many of them were pulled down. That is also a reserved space, called Z3-2. That piece of land is for the future skyscraper named “Shanghai Center”. The final design has not be chosen, but the idea is to have something between 550 to 700 meters in height. Hmm…. Another tall building.
Maybe the photos in this post: World Financial Center give you some idea about what the skyscrapers in Lujiazui looks like.
Everyone is very optimistic about the future of Shanghai. I am so too. However, most of the bubble happens when people get over optimistic.
is Shanghai feeling the ill-effects of the global economic meltdown going on?
Interesting. I’d love to hear people’s thoughts (esp. Jian Shuo) on residential real estate. I hear that prime locations in Shanghai like Jing’an are now at RMB 40,000 per sq. meter. That is about $617 per sq feet at current exchange rate (7.2 RMB: 1 USD). Near Palo Alto near Stanford University, homes might cost $800 per sq feet. or so, including a nice piece of land, maybe 6000 sq feet. So Shanghai prices are pretty close to Bay Area prices, one of the most expensive places to live in the US.
Not sure where the bubble effect is stronger!
one other thing, US commercial real estate is expressed in USD psf (per sq. foot) per month (or per year). So a 3.3 USD/day/sq mt. is about USD11 psf per month! In Palo Alto, our rent is about USD3.75 psf per month and that is with Facebook coveting our space and everything without walking distance to Facebook. But this is not really comparable to Shanghai Pudong financial district. Manhattan NY mid-town is a better comparable. I think rents can be around USD125 psf per year for nice buildings, which is pretty comparable to the 3.3 USD/day/sq mt. Another example of globalization…at the top end, everything (rent, salaries, etc) are the same…but at the bottom end, big disparities.
elliottng: Very well said. I totally agree.
Commercial office space rent is about $50 psf per year where I work, 10 miles west of Washington, D.C.
And they are building the IFC tower which is diagonally left opposite of Shangri-La. HSBC will be the anchor tenant for that IFC tower.
It seems Lujiazui is becoming more and more interesting with the new buildings. On the background of this, the Shanghai Stock index dropped to by 7% today to below 5000 points.
@cheery, I am not familiar with Canon camera. Sorry that I cannot help. I don’t want to be anything to anybody. :-)
Oh, my god!
I have known and read your blog for 3 years……….but this is the first time I post a comment.
I just found that you graduate from Luoyang yigao 926. And for me, I graduate from Luoyang yigao 993.
You are an outstanding member of Yigao. Hope can know you and maybe some day, when the schoold fellow of Yigao meet in Shanghai, you can remember me and take me in:-)
I took some videos and photos of Liujiazui. I’ll try to post them on my blog if anybody cares to see them.