China is known as the infrastructure maniac. Besides, high altitude is also very popular in China. Accordingly, China has 50 of the 100 tallest bridges in the world. Beipanjiang Bridge in Guizhou province is the world’s highest bridge. It is more than 1,800 feet above the Beipanjiang Grand Valley.
China also has one more thing they strive to achieve, only to fail and end up with the world’s most abandoned high-rise buildings. For example, Goldin Finance 117 in Tianjin was built 14 years ago and still shows no signs of completion.
China currently has more than 2,900 buildings over 490 feet tall, over 950 over 660 feet tall, and an astounding 100 skyscrapers over 980 feet. In all three categories, it leads the world.
However, not all of them are successful. In 2021, the office vacancy rate would exceed 20% in some cities, as high as 40%.
Among them are many unfinished buildings, such as Goldin Finance 117. As of September 2020, China has 81 skyscrapers, of which 66 are unfinished.
What prompted China to build skyscrapers despite its tirelessly low occupancy rate and its consequences? Today we will explore that.
In 1982, the tallest building in China was the 24-story Park Hotel, completed in 1934. It is an art deco gem of Shanghai.
But after taking power in 1949, China’s leaders didn’t think so. Instead, in the context that China emerged as an investment destination, they saw Park Hotel and other low-rise urban landscapes as symbols of China’s backwardness.
Regulators allowed tall buildings to begin springing up around Shanghai quickly. According to the 2013 Shanghai Statistical Yearbook, the city had only about 100 buildings taller than 20 stories until 1990. This number skyrocketed to more than 3,700 in 2000 and 7,400 by 2012.
That wasn’t enough, with ambitions to become a global financial center on par with London and New York. So Shanghai began planning to build shopping malls worthy of it.
The plan included the development of three giant skyscrapers in a tight cluster, Jin Mao Tower, The Shanghai World Financial Center, and Shanghai Tower. The Shanghai Tower is 2,100 feet tall and was completed in 2015, becoming the second tallest building in the world.
It was not just Shanghai’s ambition, but it also occurred across China. For example, five of the ten tallest buildings in the world are in mainland China, such as Shanghai Tower, Ping’an International Financial Center in Shenzhen, Guangzhou Chow Tai Fook Finance Center, Tianjin CTF Finance Center, and Citic Tower in Beijing.
According to recently revealed figures, China currently has around 400 supertall structures over 980 feet in height that are either built, are under construction, or are scheduled for development. More than one-third of the supertall buildings in the world are found there. And Shanghai, Shenzhen, Guangzhou, and Hong Kong are home to the majority of these numerous very tall structures.
Some people said that supertall buildings were built to make the most of the limited urban land available. But it doesn’t explain why skyscrapers were constructed in China’s 2nd and 3rd tier cities, where urban space is plentiful.
But in fact, local authorities in new districts often generously provide construction sites, with large squares or landscape strips around them, for residents to view these construction achievements.
For example, Nanchang Greenland Central Plaza was under construction from 2011 to 2015. It comprises two supertall skyscrapers, around 990 feet, located in Nanchang, Jiangxi, China.
So what is the real cause? First, let’s return to China’s tallest building in 1934, the Park Hotel.
Tongji University associate professor Liu Gang said, “The Park Hotel connects our past to the future. Skyscrapers encourage us to strive for more.”
A Chinese researcher and writer, Chen Hongbin, declared, “This is related to their misconception that magnificent and super skyscrapers are a symbol of a city’s state of modernisation. They thus compete with each other to see who can build taller buildings.”
The feeling of power and prosperity drives local authorities to build high-rise buildings.
Then, as China’s economy booms, it requires more office space. And as wealth is created, the middle class needs homes. At the same time, construction technology made significant advances, and real estate developers took advantage of these opportunities. As a result, China’s real estate has become an essential contributor to the country’s growth.
In 2021, Goldman estimated the size of China’s real estate sector as accounting for 23.6% of its gross domestic product.
So the second reason is that the Chinese regime has promoted real estate investment growth as a driving force for economic growth.
However, due to its grand ambition, the Chinese real estate industry also created a rare phenomenon worldwide. “Ghost cities” began to appear in the early 2010s. Among them, of course, there are abandoned skyscrapers.
First is the Zhongshui building, with a height of 570 feet and an investment of $650 million. The developers have a background in state-owned enterprises, and from the 1990s, the Zhongshui building quickly became famous.
However, when Hong Kong, investors, hit hard by the Asian financial crisis, fled, the investor defaulted, and the lawsuits continued. As a result, the Zhongshui building, which has not been rescued after several auctions, can only be plastered with giant advertisements to cover its ugliness.
The second is the 41-story “Golden Landmark Building,” which has been unfinished since 2007 and is still idle in Lujiazui, where every square inch of land is expensive.
Although the outer wall of the building has been completed, it is difficult to see what is different from other high-rise buildings, but when you get closer, you will find that the building is tightly fenced off by walls more than 6 feet high.
It was nearly completed in 2007, but the Golden Landmark Building became an unfinished building because of a lawsuit involving two banks for a loan of $59 million and a lawsuit for arrears of around $1.5 million in construction payments from a decoration company.
The third is Goldin Finance 117, an unfinished 2,000 feet skyscraper in Tianjin, China. The total investment is about $8.9 billion. It is currently certified by Guinness World Records as the tallest uninhabited building in the world.
Construction began in 2008, but since 2005 the developer, Goldin Real Estate, has started to raise capital.
Between 2005 and 2010, Goldin raised around $1 billion by issuing new shares and convertible bonds.
The sales of Building 117 were not good, and some people said that due to the high price, they just sold several percent of the total area.
The building has a high-end customer segment but is in a second-tier city in China, so those who can afford it are not interested in it.
Besides, Goldin Real Estate has a high leverage ratio, so after the global crisis in 2008, it ran out of money.
Work was suspended in January 2010 due to the effect of the great recession. When it finally resumed in 2018, the project’s contractor, China State Construction Engineering Corporation, left with no return date.
Since then, construction of Building 117 was also halted due to a broken capital chain, and it became an abandoned building. However, today it still has another function as a location for daredevils to climb and post their achievement on YouTube.[Video 1:30 – 1:36]