Former Beijing wholesale market being turned into high-tech incubator

BEIJING - Gu Xiaozheng, founder of a drone development startup, has just moved his office from Zhongguancun, known as Beijing's "Silicon Valley," into an office building near Beijing Zoo.

The building was formerly well-known to Beijing residents as a garment market, one of 12 shopping malls within the Beijing Zoo Wholesale Market, which was the largest garment distribution center in north China until it was closed and cleared out in 2017.

The building has been renamed Baolan Finance and Innovation Center and contains 11,000 square meters of office space. Gu's firm, which develops industrial-use drones, was among the first group of nine tenants that have moved in.

"The office is more spacious than the one I rented in Zhongguancun, and more importantly, the location is much more convenient and less crowded," he said.

Among the other tenants are six tech firms, an internet company and a national incubator "Wework," which provides shared workspaces for startups and freelancers.

Li Ran, manager of the Baolan center, said the Zhongguancun Xicheng Science Park helped select firms with high development potential to enter Baolan.

After garment sellers moved out, a total area of 350,000 square meters has been cleared for office space.

Sun Shuo, executive deputy chief of Beijing's Xicheng district, said that in addition to Baolan, further office space is currently being planned. Future tenants have to meet the area's development orientation as a finance, science, service and cultural center.

"The wholesale market was closed under Beijing's development strategy to relocate non-capital functions. The city is aiming to achieve quality development," he said.

The "Zoo Market" was built in the mid-1980s for wholesale garment sales, from cheap knock-offs to brand names. Business remained robust attracting more than 100,000 customers daily over the past decades.

Across the second-ring road is Beijing Zoo, one of the city's top tourist attractions which receives up to 100,000 visitors daily.

"Heavy traffic congestion and high fire risks had plagued the market for many years," said Li Yunwei, an official with Xicheng district.

Plans to close the Zoo Market in order to "reduce traffic congestion and population density" were announced in 2015.

Li Xiusheng, 43, was among 40,000 people who were involved with the former market, which had around 12,000 shops.

In 2017, Li moved his business to a shopping mall in Yanjiao district, Hebei province, some 30 km east of central Beijing.

Yanjiao borders Beijing's Tongzhou district and is home to more than 200,000 people who work in the capital.

"Many garment sellers moved further away to the cities of Baigou and Cangzhou in Hebei or to Tianjin Municipality. But I wanted my business to be as close to Beijing as possible, so I settled here," he said.

Li moved to the capital from central China's Henan province at the age of 20 with only 20 yuan ($3) in his pocket.

"In 1995, my wife asked me to try my luck selling clothes on street near the Beijing Zoo, where a large group of vendors had their stalls," he said.

In 2006, Li and many other vendors moved into a newly-built shopping mall in the sprawling wholesale market, which became a goldfield for the garment traders, until November 2017, when the market was officially closed.

Most of 3,000 shops in Yanjiao's Dongcheng Shopping Mall, where Li has moved to, are held by former vendors at the Zoo Market.

For some garment traders, moving their businesses to Yanjiao has lowered their costs, as the housing and shop rental prices are much cheaper than those in Beijing.

Wang Yuming, deputy manager of the mall, said only a few shops have daily revenue approaching their past levels.

"The mall does not share the popularity of the former market in Beijing. We attract tenants with our services, from chartering planes to take tenants on purchasing trips to establishing the mall's website to help shops promote their goods," said Wang.