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Source: Times Finance Author: Zhong Dai

Recently, Shanghai released the fourth batch of residential land transfer announcements in 2024, with 5 residential land plots unveiled, and a live trading fair will be held starting from August 7. Among them, the land plot originally used as Xiaomi's Shanghai headquarters (xh128D-07 plot in Xietu Street, Xuhui District) reappeared as residential land and is planned to be transferred in a "combined bidding and auction" manner.

The starting total price of the land parcel is 3.696 billion yuan, and the starting floor price is 100,800 yuan per square meter. This means that it will surpass the 100,300 yuan per square meter floor price maintained by Rongxin in 2016, becoming the new "land king" per square meter. The maximum price limit of the total price of the land parcel is 4.8048 billion yuan. If the transaction is completed at the capped price, the floor price of the land parcel will exceed 130,000 yuan per square meter.

Why did the land price hit a new high? Zhang Hongwei, founder of Jingjian Consulting, told Times Finance that first, the land's location, quality, and surrounding facilities are good; second, the Shanghai luxury housing market was hot in the first half of this year, which supported the future sales expectations of the land; and finally, Shanghai has abolished the real estate linkage price system, so the price of new homes built on the land can be further increased.

Lu Wenxi, a market analyst at Shanghai Centaline Property, told Times Finance that the Xuhui Riverside area is within the Central Ring Road, has industrial support, and is surrounded by luxury homes, which makes it a luxury home circle. The land also has a first-line river view, and even compared horizontally within the area, it is of superior quality.

The plot is surrounded by luxury houses. To the north, it is adjacent to Huiyuan Xi, with an average opening price of 134,000 yuan per square meter; to the south is Hong Kong Land·Qiyuan, with an average opening price of 178,000 yuan per square meter; to the east is Yujiangting, with an average opening price of 131,200 yuan per square meter.

The industry expects that if the land is sold at the highest price, the break-even price of new houses entering the market in the future will be 170,000 yuan/square meter. Zhang Hongwei told Times Finance that if the developer can provide good products and services, the price of new houses built on this land may reach more than 200,000 yuan/square meter. This means that the price system of Xuhui Riverside first-hand and second-hand houses will be refreshed.

At present, potential buyers of the land have surfaced. The bidding platform shows that Shanghai China Merchants Real Estate Co., Ltd., a wholly-owned subsidiary of China Merchants Shekou (001979.SZ), has released a bidding plan for the land, with a total investment of 5.4 billion yuan and a construction fee of 680 million yuan. The bidding is scheduled to start on August 20.

"Tongce Luxury Homes" pointed out that there will be 140 luxury new housing projects (on sale & to be sold) in Shanghai in 2024, including 91 pure new projects. The next few years will still be the peak period for the supply of luxury homes in Shanghai.

Looking back, the land was won by Xiaomi's wholly-owned subsidiary Mi Space (Shanghai) Information Technology Co., Ltd. in 2021. At that time, it was used as commercial office land. The transaction price was 1.55 billion yuan, equivalent to a floor price of 31,001 yuan per square meter.

At that time, Xiaomi stated that the land was planned as the Shanghai headquarters site as early as 2018. Xiaomi's Shanghai headquarters has many functions, including mobile phone research and development, finance, Internet and other businesses. The construction of the headquarters can bring together many business teams.

Now, the land is undeveloped and is planned to be put back on the market. Xiaomi officials responded to the media that this was due to changes in municipal planning land use and the government had a need to purchase and store it.

The recruitment software shows that Xiaomi's office in Shanghai is located in Building 7 of the 5G Future Center in Pudong New Area. Currently, Xiaomi has a large number of open positions in Shanghai, including Caohejing in Xuhui District, Kangjian in Xuhui District, Chuansha in Pudong New Area, and Jinqiao in Pudong New Area.

At present, Xiaomi has four headquarters in China, located in Beijing, Shenzhen, Nanjing and Wuhan. Among them, the first phase of Xiaomi Group's East China headquarters building in Nanjing has been put into use. The Nanjing headquarters has a total construction area of ​​365,000 square meters, including scientific research and design offices, talent apartments and related supporting facilities, and will become one of Xiaomi's most important software R&D centers outside of its Beijing headquarters.

Zhang Hongwei commented to Times Finance that after the land parcel xh128D-07 in Xietu Street, Xuhui District, was acquired and converted from commercial to residential use, the floor price increased from 30,000 yuan/square meter to over 100,000 yuan/square meter, the value of the land parcel was reflected, the government's fiscal revenue also increased, and the market enthusiasm was boosted. At a time when Shanghai is focusing on developing headquarters economy, the government may provide another headquarters land to Xiaomi as a replacement.