Record high sales price for property creates new 'land king'

A plot of land in Beijing was sold at record breaking price on Wednesday. The sale underscores the attraction of premier land in the capital even at a time when negative sentiment dominates the market.

Beijing Huarong Infrastructure Investment Co Ltd became the "land king" when it won a bid on a parcel of land on Beijing's Financial Street, a street similar to New York City's Wall Street, with a total value of 7.46 billion yuan ($1.21 billion).

"Land king" is a Chinese term that refers to developers that purchase land at high prices. Whenever a new "land king" appears, the entire real estate industry is shaken.

Beijing Huarong, a company affiliated with Beijing's State-owned Assets Supervision and Administration Commission, went through 193 rounds of bidding. It finally purchased the plot at a premium, 2.1 times the minimum bid price.

The commerce-use land was purchased for 96,500 yuan per square meter, according to Beijing Centaline Property Agency Ltd's estimate. The price even shocked industry insiders.

Beijing Huarong's "ascension" to "land king" came at a time when Beijing's land market cooled dramatically. Land sale revenues in Beijing fell by 45 percent in July over a year ago, according to China Index Academy. In late July, two parcels of land in Beijing failed to be sold during the auction process.

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