Wednesday February 25, 2009
Reporting from Beijing — “Empty,” says Jack Rodman, an expert in distressed real estate, as he points from the window of his 40th-floor office toward a silver-skinned prism rising out of the Beijing skyline.
“Beautiful building, but not a single tenant.
So goes the refrain as his finger skips from building to building, each flashier than the next, and few of them more than barely occupied.
Now, six months after the Games ended, the city continues to dazzle by night, with neon and floodlights dancing across the skyline. By day, though, it is obvious that many are “see-through” buildings, to use the term coined during the Texas real estate bust of the 1980s.
By Rodman’s calculations, 500 million square feet of commercial real estate has been developed in Beijing since 2006, more than all the office space in Manhattan. And that doesn’t include huge projects developed by the government. He says 100 million square feet of office space is vacant — a 14-year supply if it filled up at the same rate as in the best years, 2004 through ’06, when about 7 million square feet a year was leased.
“The scale of development was unprecedented anywhere in the world,” said Rodman, a Los Angeles native who lives in Beijing, running a firm called Global Distressed Solutions. “It defied logic. It just doesn’t make sense.”
This article was posted: Wednesday, February 25, 2009 at 5:52 am