Property

Height of ambition

Changsha wants to build world’s tallest building

Burj Khalifa: highest, for now

In January 2010 the world’s tallest building opened in Dubai. At a height of 828 metres the Burj Khalifa beat the previous record holder Taipei 101.

This feat of engineering took six years to construct.

But if Changsha has its way, Dubai will soon lose its skyscraping record.

The city in Hunan province has announced a spectacular plan to erect an 838-metre residential tower. More remarkable still, the 21CN Business Herald reports that it will be built in just seven months.

On June 5 the local government signed an agreement with one of Changsha’s foremost firms to build Sky City. The company is Broad Group, whose core business is air-conditioning (see WiC44). Its owner Zhang Yue is a man who could never be accused of lacking ambition. In 1997 he purchased China’s first private jet and the grounds of his headquarters are dotted with replicas of the Pyramids, Buckingham Palace and Versailles.

This project is being undertaken by the group’s subsidiary Broad Kejian Science and Technology. Founded in 2009 the firm has a reputation for constructing buildings in record times (and, it claims, building them so that they can resist magnitude nine earthquakes).

The secret of its speed? It prefabricates sections of the buildings in factories and then assembles them on site. Broad Group’s construction of the Ark Hotel in Changsha proved an internet sensation (see WiC86), with video uploaded by the firm showing that the 15-floor building went up in just six days. It followed this Herculean act by constructing a 30-storey hotel in a mere 15 days.

Nevertheless, Broad’s latest project has sparked doubts. “Is it technically feasible to complete the construction of an 838-metre building in seven months? Has Broad Group enough cash to complete the world’s tallest building?” asks the 21CN Business Herald.

The newspaper says it remains suspicious of “Zhang’s high-rise dream”. According to Sina, there was sceptical reaction on its weibo service too. “Will such a building, built in such a short time be safe?” asked one. Another added: “Broad doesn’t have a lot of experience in high-rise buildings, and such uncharted territory will cause risks”.

The other question mark is over cost. Changsha’s city government has estimated that the building can be completed for about Rmb4 billion. But Sanxiang Metropolis Daily reckons that figure is too low, based on the fact that Broad Kejian Science and Technology is said to have put in a provisional order for 2.7 million tonnes of steel to prefabricate its skyscraper. Based on current prices the media calculation is that the steel alone will cost Rmb10.8 billion.

It sounds like someone is getting their sums wrong, although WiC isn’t quite sure who.

Given that Broad is a private company, the newspapers can only speculate whether it has enough cash on its balance sheet to fund this huge undertaking. How much will come from city coffers isn’t clear either. And after the media furore, there are even doubts that the project will go ahead. Xinhua has reported that final government approvals are still pending, for example. But local officials clearly view this as a prestige project that will boost the city’s image and bring in the tourists.

Few WiC readers will have visited Changsha. But the town planners evidently believe that you will be flocking there in droves once the world’s tallest building puts the city on the map.

Skyscraper construction is often said to be a sign of economic trouble ahead, with the new projects planned in periods of unbridled optimism and excess credit. Then the reality hits home: New York, Chicago, Kuala Lumpur and Dubai have all welcomed their massive new towers after economic crisis has started to bite.

China’s own real estate mood is depressed at the moment, although new data has been hinting at a potential rebound in some cities. A central bank survey released this week suggested that more than a fifth of people expect home prices to rise in the third quarter. So could Changsha go into the record books for timing its skyscraper plan to perfection too?


© ChinTell Ltd. All rights reserved.

Exclusively sponsored by HSBC.

The Week in China website and the weekly magazine publications are owned and maintained by ChinTell Limited, Hong Kong. Neither HSBC nor any member of the HSBC group of companies ("HSBC") endorses the contents and/or is involved in selecting, creating or editing the contents of the Week in China website or the Week in China magazine. The views expressed in these publications are solely the views of ChinTell Limited and do not necessarily reflect the views or investment ideas of HSBC. No responsibility will therefore be assumed by HSBC for the contents of these publications or for the errors or omissions therein.