An interesting conditional deal with Yulin Local Government

Published on April 30 2016

Yulin Aoyuan under development

Redstar has surendered.

Yulin is the second most populated cities in Guangxi. Aoyuan has a large residential development project there in the Jade East District, selling very well. Yulin Aoyuan is composed of A site and B site as shown in the drawings posted above. Low rise zone in Yulin Aoyuan B has been developed, while construction work of the high rises blocks has not commenced yet.

Not far away, at the center of Jade East District, the local government put out a site for development into the district's commercial center in 2014. A developer Redstar paid a down payment RMB100 million to acquire the site at rather low land cost. And Redstar released a development plan to put up a Redstar Square. Nevertheless, rehousing of the two villages there and clearance became a problem not easy for the developer. Later, Redstar surrendered the down payment and gave up the project.

Among those villagers' houses with approval, many are illegal structures. Obviously, Aoyuan is not in a rush, as Aoyuan has a profitable project in hand in the city. Though details of the conditional agreement is not known, I believe Aoyuan would not take up the sole responsibility for the site clearance. Instead, Aoyuan might make use of what is in hand to assist the local government in relocation of the residents at the site. I would say, Aoyuan is now the most possible party in the city to offer a hand in need to the local government. In the other hand, with the surrendered RMB100 million down payment from Redstar, the officials should be with extra source to kick start the long outstanding site clearance operation.

It would take time, yet worth the wait.

Yulin Aoyuan