Property

The Greater Bay Area presents rare opportunities (I)

Greater Bay Area

The opportunities posed by the Greater Bay Area has been a hot topic, as evidenced by a string of talks on the area’s real estate developments that I recently attended. Apart from Hong Kong and Macau, the Greater Bay Area also constitutes nine mainland cities - Guangzhou, Shenzhen, Zhongshan, Jiangmen, Zhanqing, Zhuhai, Foshan and Huizhou, all located around the Pearl River Delta.

>> Property market in the Greater Bay Area

Government policy is a crucial influencer for mainland economic development, and although not all Government initiatives turned out to be successful, Government-backed projects do tend to have a higher success rate. A detailed plan for the Greater Bay Area initiative is expected to roll out in October at the earliest. With every city doing its own planning and having different views on priority and positioning, I think that the emphasis of the overall plan will be the coordination and collaboration among all of the cities involved. 

Hong Kong doesn’t have a great history in cooperating with neighbouring cities. During the planning phase of the Hong Kong-Zhuhai-Macao Bridge, Hong Kong insisted on setting up three separate border controls instead of an integrated one. Another example is the Mangrove Natural Reserve, a luxury home development area in Shenzhen, which directly faces the West New Territory Landfill and the Black Point Power Station across the water, and suffers the negative impact brought by the trash incinerators in Hong Kong. In addition, the lack of communication and cooperation between cities in the area has also resulted in numerous redundant constructions of airports, ports and other infrastructures.

Twenty years after the handover, Hong Kong is still living in the bygone glory of past success and economic power, and has a sense of superiority when collaborating with mainland cities, which often leads to sub-par results. Hong Kong’s current GDP is HK$2,500 billion; as Shenzhen and Guangzhou each has a GDP of near CNY2,000 billion, it seems only a matter of time that the two cities will catch up to Hong Kong.

There could be a huge change taking place in the real estate market as well. Thanks to the extreme scarcity of land supply, Hong Kong’s housing and rent prices are incredibly high. Under the Greater Bay Area initiative, there will be four bridges connecting the east and west banks of Pearl River, including the Humen Bridge 1 and 2, the Shenzhen–Zhongshan Bridge and the Hong Kong-Zhuhai-Macao Bridge. By 2020, seven new high speed railways will forge a transportation network centered in Guangzhou, and connect it with other Greater Bay Area cities within an hour.

In other words, in the near future, we can work in Hong Kong while living in Zhongshan or Jiangmen. The quick one-hour commute can significantly reduce living costs, so the question is not whether it’s possible, but whether we’re ready. With different political systems and various cultural dissimilarities, Hong Kong and the mainland are currently having disagreements regarding whether to set up a joint port area or separate border controls. Such debate certainly doesn’t help Hong Kong’s integration into the Greater Bay Area, or the housing problems faced by Hongkongers.

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