TODAY’S ALTERNATIVE, TOMORROW’S MAINSTREAM Since the emergence of London in the late 19th century, finance has always been the foundation of some of the world’s greatest cities. However, this hierarchy is now increasingly being challenged on multiple fronts. The irrelevance of distance and boundaries have been made possible by technological progress and transport networks but ultimately, it would be the global financial turmoil in 2008 that dealt the crucial blow. Faced with onerous regulations, dwindling margins meant that cost rationalization would take precedence. This has diluted the presence of financial institutions in core CBDs as banks continually refined its operating and leasing strategies to adapt to the changing business landscape. While the core CBD will still remain relevant, due to a buildup of both soft and hard infrastructure through the decades, the rise of secondary and alternate locations in the corporate real estate strategy of financial institutions will continue to gain prominence.

Qianhai China has high hopes for the Qianhai special economic zone in the southern boomtown of Shenzhen. Positioned as a future international financial center – a new Hong Kong Central or even Wall Street of the Pearl River Delta – Qianhai is intended to promote greater business cooperation and integration with Hong Kong just across the bay. Some 20 million sf of total oŸce supply as well as several large retail projects are currently under construction or planning, including two major Grade A oŸce properties which are expected to launch in 2016 and 2018, respectively. Qianhai has the potential to grow into a regional financial and commercial

center, supporting and complementing Hong Kong, and serving as a kind of back oŸce to the Asian financial center an hour’s drive away. The zone’s importance will lie primarily in its impact on Hong Kong, the development of Guangdong province, and the upgrading China’s financial system. Over 100,000 companies had registered in Qianhai as of mid-2016, looking to benefit from the zone’s tax incentives and other preferential policies, although few of them are currently operating there due to the current scarcity of oŸce facilities. This should change as continued construction activity over the

coming years generates high- quality infrastructure and oŸce and residential accommodation, which are expected to be largely completed by 2020. We anticipate that Qianhai will evolve along similar lines as Shenzhen’s Futian CBD, which a decade of urbanization transformed from a largely empty stretch of land into the city’s thriving political, financial, and business hub.


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