As the FTZ will offer preferential policies in areas such as international enterprise management, trade and finance, it "will encourage companies that have overseas business to set up their headquarters [including accounts, management and sales functions] in Shanghai," Yin Li, a managing director at New York-based commercial real estate brokerage Studley Inc, told the Global Times Thursday.
Studley opened its first Chinese office in Shanghai in May.
With these kinds of advantages, the FTZ may take over from other Chinese enterprise zones, such as Kunshan in the neighboring Jiangsu Province, or even Hong Kong, Li said.
She said that Hong Kong "is losing its advantage as the center of Asian international finance due to a shortage of land resources and a continuing rise in prices for already very expensive real estate. It seems that with more unique and beneficial terms, Shanghai can set itself up as the new international center for finance, shipping and trade. It may surpass Hong Kong in all those areas."
Given that controlling housing prices is a major concern for the top policymakers, Li of Studley said that the central government may consider implementing a system of annual real estate taxes to bring down the costs of land acquisitions while still providing local governments with revenues.
The price of office and retail properties is likely to rise faster than for residential properties, Li noted.
"We would expect the rules and government policies for each would be differentiated to manage business growth and moderation of residential housing costs," she said.In the Zone
Studley Opens its First Office in Shanghai, China
Studley Launches Shanghai Office, Its First in China