The Hangzhou government has made a big move to cut into the bottom line of real estate tycoons who were intent on building the highest building around the scenic West Lake. Translated by CDT from People Online via sina.com:
West Lake has been the beacon of beauty in Hangzhou for centuries, written about in endless poems and legends. And now in a booming China, pretty bodies of water like this have also become a hot commodity for real estate developers. No wonder when the old 72-meter building on the former Zhejiang University campus was demolished in January last year to make way for new developments, Hong Kong’s Kerry Group proposed to build a taller hotel complex, 85 meters tall, that will become the lake’s highest spot in its vicinity, and probably the most expensive building.
Recently, Hangzhou’s party secretary Wang Guoping said no to this plan. He figured that the height of this new building interferes with the beauty of this lake environment and buildings around it. “Kerry building will be shortened to 56 meters,” he said in a meeting, which according to industry analysts will mean hundreds of millions of yuan in losses to the developer.
Kerry Group bought the land from Zhejiang University for 2.46 billion yuan and drew its plan to erect a 85-meter five-star Shangri-la hotel, a 63-meter office tower and two 60-meter up-scale apartment buildings. The city’s top official’s late decision could easily cut into the bottom line of the Hong Kong developer. At a reserved rate of 50,000 yuan/square meter on this complex, a 1/3 height loss in the building will shrink 17,000 square meters or 8.5 billion yuan in revenues.
A quite decent move by a local government, especially when it comes to saying no to tycoons with stacks of big cash.
