Vanke Consortium's "Original Team" Returns, Qingdao Licang Site Sells at the Lowest Price After Commercialization Removal

Guanyan.com On March 20, the online auction results organized by the Qingdao Natural Resources and Planning Bureau for state-owned construction land use rights showed that the LC0301-03 plot located east of Qingyin Expressway in Licang District was successfully transferred.

According to the previous announcement from the Qingdao Natural Resources and Planning Bureau, the starting total price for this land parcel was 998 million yuan, with a starting floor price of 9,010 yuan per square meter.

The transaction was won by Qingdao Changming Real Estate Co., Ltd., with a total price of 998 million yuan and a premium rate of 0%.

Public information indicates that the company is jointly funded by Vanke, China Overseas, Yuexiu, Gemdale, and Qingdao Urban Investment.

The bidding process was straightforward, with the rule “highest bid wins,” but only one bidder registered, and no bidding rounds occurred.

Unlike typical new land acquisitions, this land’s uniqueness lies in its “re-entry” property.

According to public data, this land was originally part of the Dongli Forest Park project. Several years ago, it was jointly acquired by Vanke, but due to slower-than-expected development progress, the land was eventually returned to the government through negotiations.

Within a few years, the process involved “transaction—stagnation—return—re-auction.”

Land Reboot

From the auction conditions, the core change of this land parcel stems from planning adjustments.

On February 28, the Qingdao Natural Resources and Planning Bureau announced the auction of state-owned construction land use rights, officially re-listing the LC0301-03 plot in Licang East.

The land use designation was changed from “commercial and business land” to “second-class residential land,” with additional public service facilities such as education, medical care, and eldercare included.

Meanwhile, the floor area ratio was reduced to 2.5, a medium-low level, significantly lower than the previous 3.57.

The auction documents show that the land is bounded by Qingyin Expressway to the east, Shiniushan Road to the west, Zaoshan Road to the north, and Jiushui Road to the south, covering approximately 44,320.7 square meters, with a planned construction area of about 110,800 square meters. The project must include community service stations, childcare facilities, and supporting commercial spaces, which will be handed over for use after completion.

This land is located on the east side of the Dongli area, near existing residential communities and close to forest park resources. Surrounding educational, medical, and community facilities are being gradually planned and improved.

Considering the floor area ratio, volume, and construction constraints, the future product of this project is expected to mainly consist of mid- to high-rise residential buildings.

It is important to note that the price structure has also changed before and after the adjustment.

Before the planning change, the starting total price was about 1.187 billion yuan, with a floor price of approximately 7,500 yuan per square meter; after the adjustment, the starting total price decreased to 998 million yuan, but the floor price increased to 9,010 yuan per square meter.

In other words, the total price decreased, but the land unit cost increased, changing the development logic accordingly.

Vanke’s Choice

If we trace back in time, the history of this land is more complex.

In August 2017, Qingdao Vanke Real Estate Co., Ltd. acquired three combined plots east of Qingyin Expressway in Licang District (originally numbered 4362-01, 4362-02, 4364-02) for 3.79 billion yuan, with a total construction area exceeding 500,000 square meters. The LC0301-03 plot being re-auctioned now was originally the 4362-01 plot.

The 4362-01 plot was purely commercial land, while the other two were residential and comprehensive land. Commercial use accounted for nearly 40% of the overall project.

More critically, the conditions of land transfer were demanding.

At that time, bidders were required not only to build schools and kindergartens but also to introduce headquarters of financial institutions, Fortune 500 companies, and to hold a certain scale of property and meet tax contribution targets.

These additional conditions created high development thresholds from the start.

Vanke ultimately acquired the project for 3.79 billion yuan and brought in China Overseas, Gemdale, Yuexiu, and Qingdao Urban Investment for joint development, but progress was not smooth.

Follow-up developments show that residential parts were developed first, while the pure commercial 4362-01 plot remained largely undeveloped. Public data indicates that construction progress on this part lagged significantly, becoming a major bottleneck for the overall project.

In other words, the problem was not with the residential component but with the commercial part.

As market conditions changed, the commercial absorption cycle lengthened, and development uncertainties increased. The risks of such large-scale integrated projects gradually became apparent. Eventually, this commercial land was stored by the government, and after the master plan was adjusted, it was split and reorganized, re-entering the market under the new code LC0301-03.

This time, variables were reduced.

Commercial was separated, the floor area ratio lowered, and the development model shifted to mainly residential; the total price was reduced to a controllable range; the construction requirements remained, but the development cycle was shortened.

Under these conditions, Vanke re-entered the bidding list.

Reports indicate that the company had prior experience in this area, familiar with the project situation and market acceptance. Re-entering now is more about continuing the existing project chain rather than making new investments.

In other words, this is not a simple land acquisition but a “return to the starting point for re-decision.”

The result is still the original team—Vanke, China Overseas, Yuexiu, Gemdale, and Qingdao Urban Investment jointly acquiring the land.

For Vanke, this land is part of a historical project and within a familiar development environment. Compared to re-entering an unfamiliar sector, taking over a dismantled, risk-clarified land parcel is more controllable.

From a policy perspective, current policies generally encourage the supply of improved housing, especially in core cities and prime areas, by optimizing floor area ratios and adjusting land use types to enhance product quality.

This time, the Dongli land was converted from “commercial to residential,” reflecting this policy orientation.

Disclaimer: The content and data in this article are compiled by Guanyan.com based on publicly available information and do not constitute investment advice. Please verify before use.

(Edited by: Wang Zhiqiang HF013)