Posts Tagged ‘olympics’

Olympic Rents

Thursday, July 24th, 2008

We saw it coming when Ascott serviced apartments placed an Olympic themed full-page advert on the back page of a magazine two weeks ago. Not wanting to seem glib, but we predicted this back in August 2007. Asking rents at 3-5 times the norm at many hotels and serviced apartments were ridiculous. Yesterday’s article on Bloomberg shed more light on the market. With corporate clients having booked well in advance, the money’s in the bank at the city’s premier hotels. For others, getting premium rents may be a struggle. We know of one high-end serviced apartment in the city that’s officially maintaining the premium Olympic rate but at the same time is discretely offering standard rates to some clients.

Beijing vs. Shanghai

Sunday, November 11th, 2007

We often get asked by expatriates, “What’s the difference between living in Beijing and Shanghai?”. Here’s an excerpt from an email sent to a Dutch client who may be relocating from Tokyo. His company gave him the option of moving to either city.
Shanghai is quite different from Beijing. In Beijing all the development is on the east side, with the villas in Shunyi to the northeast. Shanghai’s divided by the Huangpu river. Puxi on one side, newer Pudong on the other. There are 4 main villa clusters (and several smaller ones). Three are on the Puxi side, and one on the Pudong side. Your office is in the Xin Tian Di area on the Puxi side of the city.

The villa area in Pudong is new and quite well planned. The ones in Puxi are similar to those in Beijing. None of the clusters in Shanghai have the same concentration of amenities that Shunyi (in Beijing) has. The area around your office is quite pleasant. There are a number of good apartment options, but being in the city centre, tends to be favoured by singles or couples with toddlers.

During peak hours, the commute between your office and the American School would take an hour while the commute between the American School and the newer Pudong cluster would take at least 90 minutes. Of course, there are international school in all the villa clusters. But in a nut shell, in Shanghai, your choice of housing location is VERY dependent on (a) your school and then (b) your office. In Shanghai it’s more like living in different townships rather than a single city.

As for lifestyle Shanghai is definitely more developed and a better run city. Beijing is catching up, with the Olympic infrastructure being the driving force. For Chinese culture, Beijing is richer. For nightlife and foreign acts, Shanghai is more like Hong Kong. Many Beijing expatriates learn to speak at least rudimentary Chinese within a year. In Shanghai few do as English gets you further - Philippino waiters and maids are common there. Shanghai shopping is definitely superior, expecially in the higher end. But for mountains and outdoor excursions, Beijing has more to offer. It really depends on what your interests are.

One last thing, please budget for Beijing short-term housing to be very expensive in the summer next year due to the Olympics. Expect rents for small serviced homes to be similar or more expensive than for a long term villa. Also, you should book now. When relocating to most cities, it’s normally a good idea to spend 1-2 months in a serviced apartment during which you find a more permanent home. However, in Beijing (and Shanghai) expatriates cluster in a handful of high-occupancy villa communities. The turnaround is over the summer, and by July each year, many of the better homes are leased out. By August you’re left with either poor decor and/or crazy rents (from wealthy landlords who are not price-sensitive). If you’d like to be here for the Olympics, you need to prepare early - either by staying in a serviced apartment, or selecting your permanent home in say, May. If the Olympics is not important, I recommend selecting your home in June and moving in as soon as the games are over.

Hope this helps in your decision making. Do let me know if you have any questions.

Best regards,


10 beds in 2008 [Olympics Part I]

Tuesday, June 12th, 2007

Last month we received an inquiry from a Danish broadsheet. They were sending 10 journalists out to cover next year’s Olympics and would need accommodation for a month. Their soon-to-be Beijing correspondent was coming out on a fact finding trip for his colleagues (and also to find his own long-term housing). Peter was consulting.

Beijing’s serviced apartments are only just starting to publish their rates for short term (1 month) guests. Rates are currently at 3-4 times the norm. Most require half of the total rent to be paid on booking and the rest on arrival. One bedrooms at the city’s mid-tier serviced apartments now rent for around RMB10,000/month. It’s not going to be cheap next year.

At Athens the Danes rented a house together that was an hour’s drive from the city. They were looking for something similar here. We put our thinking hats on. There is a house in the first phase of a Shunyi villa compound that rents for a very reasonable RMB700/day. It’s a bit run down, but perfectly inhabitable. The landlord’s representative verbally agreed to lease it to the journalists for the standard rent. Mission accomplished, the Dane returned home. A few days later, Peter calls to confirm the booking and but is told that it’s not going to happen. It will be for lease, but the landlord hasn’t decided how much he wants to charge. It won’t be RMB700′day. The Client isn’t happy.

Less price sensitive corporate guests who book early will be catered for next year. At the other end of the spectrum, less discerning back packers will (as always) be able to find shelter. Expect a myriad of home-stay and low-end homes for short-term lease. However, there will be a shortage of mid-tier options.

In Athens, a teacher could pack his personal items into his garage, lease out his suburban home at a premium and fly off to Florida for four weeks with his family on the proceeds (and have change to spare). Daily expenses would be steal for Euro earners. It won’t happen here. Middle income accommodation would be deemed unacceptable by their middle income counterparts abroad. There is a plethora of mid-tier homes for rent in the city. However, the landlords would have to forgo or shorten leases commencing August 2007 and even if the property happened to be vacant next summer, there are other factors weighing against leasing to Olympic guest. A one month Olympic lease would entail a property being de-facto unleasable for 4 months - not to mention the bedding and kitchen utensils that would have to be provided. Would you set aside r your investment property for rent during the Olympics, or rent it out next week at the standard rate to an expatriate?