Chengdu Rail Transit and the Fourth City: The TOD “Hidden Line” in Five Land Plots Worth 43.44 Billion Yuan

On June 24, five parcels of land with a total area of about 195 mu in the core area of the Chengdu Linjiaba TOD were granted at the reserve price for a total of 4.344 billion yuan. The winning bidder was Chengdu Jinjiang Jinlinba Construction and Development Co., Ltd. (a consortium of Chengdu Rail Transit Group and Jinjiang Unified Construction).

The five parcels are located in the Panjiagou area of Jinjiang District, specifically including parcels 4, 5, 10, 18, and 19. Among them, parcels 5 and 10 (and parcel 15) are for urban residential land, while parcels 4 and 18 are for commercial service land. The total net land area is approximately 130,300 square meters, equivalent to about 195.39 mu.

The previously published land transfer announcement shows that these five parcels were auctioned under a combined-supply arrangement. Individual applicants were not accepted. Prospective bidders were required to register for and participate in the bidding for all parcels at the same time, and they were required to separately and fully pay the bid bonds for each parcel in the combined supply.

Based on calculations, the total bid bond for these five parcels amounted to 826 million yuan. Meanwhile, the transfer announcement also stated that the prospective bidder or the actual controller of the prospective bidder must have the capability to construct and operate rail transit lines.

From financial strength to construction and operational capability, the setting of the land acquisition threshold significantly narrowed the scope of eligible participants, excluding most real estate companies. As the core entity responsible for the planning, construction, and operation of Chengdu’s urban rail transit, Chengdu Urban Rail Transit Group ultimately entered the land auction market and successfully secured the land.

This result was actually not surprising. In recent years, the business radius of Chengdu Urban Rail Transit Group has continued to expand. Alongside this public-market land acquisition, the underlying growth trajectory has also come to light.

Longtime partners join hands again

According to Qichacha information, Chengdu Jinjiang Jinlinba Construction and Development Co., Ltd. was established on April 30, 2024, and is under Chengdu Urban Rail Transit Group. It is held 51% by Chengdu Rail Transit City Investment Group Co., Ltd. (abbreviated as “Chengdu Rail Transit City Investment”) and 49% by Chengdu Jinjiang District Unified Construction Co., Ltd. (abbreviated as “Jinjiang Unified Construction”). The former is a wholly owned subsidiary of Chengdu Rail Transit Group Co., Ltd.

Judging from the transfer conditions and the bidding results, the five parcels bundled for sale appear to have been “tailor-made” for Chengdu’s rail transit. In addition to relatively strict bidding qualification requirements, the parcels also set demanding requirements in terms of construction obligations and the responsibilities of the winning bidder.

These include requirements that commercial and residential developments must be completed and put into operation simultaneously, and that supporting park green spaces must be built as well. For example, for parcel 4, the winning bidder must hold no less than 70% of the total above-ground permitted commercial gross floor area under its overall ownership, with a total investment of no less than 700 million yuan. It must introduce and cultivate high-caliber enterprises with national or regional headquarters functions.

For parcel 5, it is explicitly required to build a commercial project with a permitted gross floor area of no less than 20,000 square meters for diversified business formats such as retail, dining, and entertainment (with a building height no greater than 24 meters). Within 3 years after completion, at least 2 national first stores must be introduced, and at least 5 brands of southwest China or Chengdu first stores must be introduced. The winning bidder must hold 100% of all permitted commercial gross floor area under its overall ownership, and it must introduce a commercial management and operation service company with experience in operating large commercial complexes to operate the project as a whole.

Overall, these preconditions far exceed the scope of traditional land development, imposing extremely specialized and composite capability requirements on bidding companies. Competition among bidders is no longer simply about “the highest bidder wins”; it also requires mature TOD overall planning and integrated construction capabilities. In addition, the two commercial land parcels also set requirements for the bidding company’s ability to attract and operate tenants, to ensure that future rail transit, commercial, residential, and related public amenities can be delivered and put into operation in a unified manner, and that functions connect precisely.

Where does the confidence behind Chengdu Urban Rail Transit Group’s entry come from?

According to publicly available information, this was not the first collaboration between Chengdu Urban Rail Transit Group and Jinjiang Unified Construction. In 2020, the two parties joined hands to build the first TOD project in Jinjiang District, “Sichuan Normal University TOD” (Chuan Shi Da TOD).

In the 2020 Chengdu TOD map released for the first time, among the 16 projects, Sichuan Normal University TOD was one of the two TOD projects located in the central ring core area of the main city. The project is located in Chengdu’s Jinjiang District. It sits at the intersection of the Metro Lines 7, 13, and 20 at Sichuan Normal University Station. It covers a total site area of about 205 mu and is developed as two parcels—north and south—with plans for full-scenario products such as high-end residences, offices, and commercial complexes. The self-held commercial spaces are within a core range of about 100 meters from the subway station.

From Sichuan Normal University TOD to today’s Linjiaba TOD, what role has Chengdu Urban Rail Transit Group played in these projects?

In the past, Chengdu was regarded as a city where subways were not suitable to be built due to geological conditions. But today, it has become the fourth city in China for urban rail transit, with a rail network operational mileage of 758 kilometers. The technical hurdles and various barriers overcome behind this turnaround are self-evident.

As the rail network becomes increasingly complete, how to develop hubs along the lines efficiently and maximize the value of resources has also been put on the agenda as a new proposition for urban development.

In this regard, Hong Kong MTR has accumulated leading experience with its mature “rail + property” model. It has also been successfully implemented in mainland cities such as Shenzhen and Beijing, naturally making it one of the benchmark references for Chengdu.

But at a deeper level, 2016 was a period when MTR accelerated its external expansion. In December of that year, MTR Corporation signed a strategic cooperation letter of intent with China Railway Group (China Railway Corporation) to jointly seek cooperation opportunities in both the Chinese market and global markets. Under the agreement, the two parties agreed to establish a strategic cooperation partnership, jointly promote exchanges and cooperation across multiple fields and at multiple levels, focusing on the construction, operation, and corresponding integrated property development of high-speed railway projects both at home and abroad, as well as training for railway professionals.

To observers, this also meant that MTR’s mainland business entered a new stage. At the same time, the mainland was entering the second half of urbanization, with an even more urgent need to improve the quality of rail transit operations. The development needs of both sides aligned.

Continuously expanding business scope

According to publicly available information, Chengdu established Chengdu Rail Transit Group Co., Ltd. in 2004, responsible for the planning, construction, and operation of Chengdu’s urban rail transit. It was later also responsible for TOD comprehensive development and resource management along the rail lines.

Over more than a decade of development, Chengdu’s rail transit line network has reached a basic scale. However, how to properly manage and operate resources along the lines has become a new challenge facing Chengdu Rail Transit Group.

It was also in 2016 that Hong Kong and Chengdu reached a cooperation consensus in areas such as rail transit. In August 2017, the Sichuan Provincial People’s Government led a delegation to Hong Kong, further turning cooperation ideas into reality. During the visit, Chengdu Rail Transit Group Co., Ltd. and MTR Corporation Limited signed a comprehensive strategic cooperation letter of intent.

At the time, news reports showed that: “MTR has rich experience in railway management and operations as well as comprehensive development. Sichuan has a huge demand for rail transit development and strong capabilities in manufacturing and design. The future of this strong alliance is worth looking forward to.”

Notably, while establishing external cooperation intentions, Chengdu also systematically deployed TOD development from a top-level design perspective. In November 2017, the “Implementation Opinions of the Chengdu Municipal People’s Government on Comprehensive Development of Rail Transit Stations” was officially issued…

By building sustainable funding channels through TOD comprehensive development to support rail transit construction and operations, it is a successful model already practiced in cities such as Tokyo and Hong Kong. Chengdu also intends to follow this path, entering an important stage in which rail transit leads urban development.

In March of the following year, Chengdu Rail Transit City Investment Group Co., Ltd.’s predecessor—Chengdu Rail Transit Real Estate Group Co., Ltd.—completed its industrial and commercial registration. Two months later, Chengdu Rail Transit Group and MTR further signed a TOD project cooperation memorandum. The cooperation explored the feasibility of comprehensive property development above rail lines in Chengdu and jointly promoted the development of TOD projects.

This series of intensive moves marked that TOD development was formally incorporated into the core mission of Chengdu Rail Transit Group. In November, the “Implementation Rules for Comprehensive Development of Rail Transit Stations in Chengdu” were officially issued, which determined 105 TOD comprehensive development station sites and 75 comprehensive development vehicle bases to be implemented by Chengdu Rail Transit Group as the implementing entity, providing strong support for this systematic project.

On March 1, 2019, Chengdu’s first TOD demonstration project, Luxiao TOD, officially began construction. As of this June, Chengdu has started and is implementing 24 TOD projects, with Chengdu Rail Transit Group involved in all of them. It has clearly become an indispensable key force in the development process of TOD projects.

In the past few years, Chengdu Rail Transit Group has also continuously established cooperation relationships with multiple external platforms, including Nikken Sekkei, Vanke Property, and China Resources Mixc Life, covering multiple areas such as TOD project design, property services, and commercial operations.

Most recently, in April this year, Chengdu Rail Transit Group and Yintai Group (SCP Group) officially reached a cooperation agreement. They will build a commercial street block in Chengdu Longtan Temple TOD with “Enjoying Life, Savoring Leisure Time” as the core philosophy.

It is reported that Longtan Temple TOD is Chengdu’s first dual-station TOD, centered on Guilin Station and Guilong Road Station on Metro Line 8. The planning and construction will cover seven integrated scenarios including residences, commercial facilities, and education. It will efficiently incorporate resources such as parks and business districts in the area into a half-hour living radius of rail transit, thereby promoting integrated regional development.

The themed commercial street block developed by both parties is located at Guilong Road Station, the core commercial support of Longtan Temple TOD. The total project size is about 48,000 square meters, forming a three-story open commercial street block composed of four commercial clusters.

In fact, bringing in professional external operators is a primary model for Chengdu Rail Transit Group’s TOD commercial development. While retaining the properties for self-holding, the commercial operation segment is entrusted to market-oriented entities with mature experience such as SCP Group, China Resources Mixc Life, and Longfor. This not only avoids the group’s own weaknesses in commercial operations, but also leverages the brand appeal and refined operational capabilities of leading enterprises to ensure value release of TOD commercial supporting facilities.

At the same time, Chengdu Rail Transit Group is also making changes.

On May 30, 2024, Chengdu Rail Transit Group held the brand launch event for “Yujian,” a TOD government-subsidized rental housing program. As a result, Chengdu’s first TOD government-subsidized rental housing project officially went into operation.

The full name of the project is “Rail Transit City · Yujian Shuangfengqiao Store 1.” It provides 1,431 units (rooms). It is part of the Shuangfengqiao TOD project. In addition to this project, there are nine other government-subsidized rental housing projects that were launched in parallel in 2021, including Machangba TOD, Xingfuqiao TOD, Sancha TOD, Zitonggong TOD, Shuangliu West TOD, Zhonghuan TOD, and others—bringing the total number of units to 10,000.

From the initial planning, construction, and operation of urban rail transit, to TOD comprehensive development and resource management along rail lines, and then to more subdivided business urban operation management, Chengdu Rail Transit Group’s business radius is gradually expanding.