After the depression caused by the epidemic in 2020, the Beijing office market recovered strongly in 2021. The annual data released by Savills, Jones Lang LaSalle and other professional institutions show that the class A office market in Beijing has ushered in a comprehensive outbreak in terms of rent level, vacancy rate and sales.
In terms of star project transactions, the successful auction of Shimao gongsan, the transaction of SK building of 9 billion yuan, and the Z6 project of COSCO Group selling CBD of 6.4 billion yuan in 2021 have greatly boosted the attention and heat of the market, and even made 2021 the most lively year of large order transactions in Beijing office market in recent years.
In view of this, Savills and Jones Lang LaSalle also changed their pessimistic market views in the past few years and began to be cautious about the market trading opportunities brought by the recovery.
It is rumored that China oceanwide group, a well-known private enterprise, is making low-key contacts with powerful buyers and intends to sell its Minsheng financial center project located in the golden area of Dongdan, East Chang'an Street. If the transaction can be realized within this year, it will be the third block transaction of office buildings along Chang'an Street in recent years after Beijing Gemini headquarters building in 2020 and Beijing SK building in 2021, or it will create the history of block transaction in the high-end office building market of Chang'an Street.
scarce assets
Chang'an Street, which runs through the whole urban area of Beijing and is known as "the first street in China", is to some extent a symbolic symbol of Beijing and even the whole of China.
The history of Chang'an Street can be traced back to the Ming Dynasty. It has always been the main road with the most concentrated power and wealth in China; At the same time, due to the numerous party and government organs, historical buildings and public buildings, the supply of office buildings in this street is extremely scarce, and the stock of tradable projects can be described as "few".
The rumored transaction target, Beijing Minsheng financial center, is located in the core section of East Chang'an Street, less than 2km away from Tiananmen Square, which can be described as "the core of the core".
With this alone, Minsheng financial center stands at the top of Beijing's scarce resources.
Moreover, Minsheng financial center is not in the "ten mile long street" with an inch of land and an inch of gold, but actually occupies the southeast golden corner of Dongdan, overlooking the whole Dongdan intersection.
At the same time, the volume with a total construction area of 250000 square meters is a behemoth for the office building project on the "Shili Long Street", second only to the Oriental square across Chang'an Street; At the same time, due to the height limit policy within the Second Ring Road, the 100 meter building height also makes Minsheng financial center the highest building of "ten mile long street".
Moreover, the observation square in front of Minsheng financial center with an area of more than 20000 square meters, the lobby with a height of 9 meters and the height of 2 meters and 6 floors are unmatched by other commercial office buildings along Chang'an Street. Among them, the most distinctive are the 86 meter atrium design of Block C and the elevator connection design from four floors to the top of the building. It is rare in the scheme design of office buildings in Asia and is regarded as a classic of the whole building.
The various characteristics of Minsheng financial center are destined to be an unprecedented "century transaction" once the transaction is concluded.
for sale
In fact, the news about the sale of Minsheng financial center is not groundless. Previously, foreign media have reported relevant transaction intentions and revealed that the expected transaction price is about 20 billion yuan.
However, if we carefully analyze and compare several office building transactions on Chang'an Street in recent years, we can basically infer that the rumored price of 20 billion yuan is obviously too undervalued.
The most suitable comparison is the Beijing Gemini headquarters building and Beijing SK building, which are not far away in time and region.
In February 2020, just after the outbreak, the South Korean LG consortium sold the Beijing Gemini headquarters building with a total construction area of about 150000 square meters to Singapore Government Industrial Investment Co., Ltd. at a price of 8.07 billion yuan, equivalent to about 54000 yuan per square meter. The building was built in 2005, and its design concept and decoration style are slightly old at present.
In June 2021, harmony health insurance completed the acquisition of Beijing SK building adjacent to the Gemini headquarters building with RMB 9.06 billion; The building has a construction area of about 100000 square meters, equivalent to a unit price of about 90000 yuan per square meter. It was completed in 2006. Its comprehensive quality is higher than that of the Gemini building. Therefore, although its location is lower than that of the Gemini building, its unit price is close to twice.
The two buildings are located on Jianguomenwai street, about 3km east of Minsheng financial center. Usually, it is also regarded as the natural extension of Chang'an Street, belonging to Beijing CBD business district. Although the location is also extremely superior, it is still slightly inferior to Minsheng financial center.
From the perspective of sale timing, when the Gemini headquarters building was sold in early 2020, it was in the early stage of the outbreak of the epidemic, and there was a certain panic in the world economy, which also had an adverse impact on the objective price; In 2021, the market has obviously warmed up.
In addition, from the perspective of rent level, according to industry sources, the rent level of Beijing SK building in 2021 is stable at 11 yuan / m2 / day, while the rent level of LG building is only 10 yuan / m2 / day. The rent level of Minsheng financial center is about 15-16 yuan / m2 / day, which is the highest rent level of East Chang'an Street, which is much higher than that of Oriental Plaza in the same area, and obviously higher than that of Beijing SK building and Gemini headquarters building.
Even if the location difference is not considered, the rent of Minsheng financial center is about 1.5 times that of SK building only according to the rent sales ratio. Therefore, the converted unit price should also be about 130000-140000 yuan per square meter, so the reasonable valuation of Minsheng financial center should be about 32-34 billion yuan; Moreover, the location of Minsheng financial center is obviously better than SK building and Gemini building, and the quality is also higher than these two buildings.
In addition, according to industry insiders, the macroeconomic level is also a very important factor affecting the transaction price. As mentioned at the beginning of the article, compared with the initial outbreak of the epidemic during the transaction of the Gemini headquarters building and the recovery during the transaction of Beijing SK building, the Beijing office market in 2022 is expected to be much better.
What's more, who knows how many years will it take for the next "Chang'an Street" to have the intention of selling office buildings? This is by no means an asset that can be bought with simple money, but also an opportunity to "seize the opportunity and never come back".
In addition, it is also rumored that although it has been nearly a year since the sale of Minsheng financial center, the reason for the delay in the transaction of the project is not the lack of interested buyers; Instead, oceanwide has been in contact with many parties and is waiting for a price, hoping to sell this highly competitive core asset at a good price.
Whether there will be another "century trade" in 2022 remains to be seen by the market.
