China Tourist

Too much of a punt

Another replica town for the tourists – but are they losing their appeal?

dalian venice

O Sole Mio: Haichang’s homage to Venice – in Dalian

In the early 1920s British accountant Roland Callingham began building models of railways that he set against the landscape of rural England. When his wife had enough of his hobby she ordered him to move his train set outside their garden in Buckinghamshire. What resulted was Bekonscot, the oldest miniature village in the world.

Bekonscot is believed to have inspired the Madurodam, which opened in The Hague in 1952 and is famed for its replicas of Dutch landmarks. In the mid-eighties the Madurodam in turn enthused some visiting Chinese executives who then opened a Shenzhen amusement park called Splendid China – featuring Chinese landmarks in miniature, such as the Great Wall.

Splendid China proved to be a big hit and, as Shenzhen Evening News has put it, became part of “the collective memory of several generations” of Chinese tourists.

Over the years these parks have been getting more ambitious. Window of the World, another Shenzhen venue, opened in 1994, featuring the Sydney Opera House, Japan’s Mount Fuji and an Eiffel Tower on its long list of attractions. Some of the other newcomers caused a stir with the places they were copying. A full-size replica of the Egyptian Sphinx in Shijiazhuang prompted protests from Cairo (see WiC239). Also taken aback were the residents of the idyllic Austrian village Hallstatt, when state-owned miner Minmetals spent Rmb6 billion ($940 million) to build a knock-off version in southern China (see WiC248).

But the criticism hasn’t deterred other tourism operators from trying the same trick. The latest offering is a clone of Venice, complete with four kilometres of waterways, in the port city of Dalian. A “gate-lifting ceremony” was held last week by the project’s developer Haichang Group. Seawater has been funnelled into the copycat canals, and gondola rides will be available to paying tourists, piloted by gondoliers in traditional Venetian garb.

The Rmb5 billion ($787 million) project formally opens next May, featuring over 200 European-style buildings, although Haichang – a tourism-to-real estate conglomerate based in Dalian – is yet to decide how many of the units will be offered for sale as residential apartments.

It has said that pumps will refresh the seawater flowing through the site’s canals – with Haichang’s bosses even proclaiming that its waterborne transport will cut down on pollution from cars.

These environmental ambitions sound like a bit of an afterthought and the general feedback on Dalian’s Venice hasn’t been particularly positive.

“This must be the brainchild of someone whose head was kicked by a donkey” was one of the most recommended comments online, according to China News.

“Why do we keep copying European architecture? Can we not be more creative? Can someone build us a project based on The Riverside Scene at the Qingming Festival [an artistic masterpiece that paints the street views of the Chinese capital in Song Dynasty, see WiC86]?” another netizen asked.

Others queried the whole concept of theme parks based on other parts of the world. In the past the attractions were popular with people lacking the means or the opportunity to travel further afield. But times are changing. “With more people travelling abroad, the wow factor of European architecture copied at home is diminishing. The appeal of miniature villages has been on the wane. It may not be worthwhile to invest so much in huge replica projects,” Hong Kong Economic Times warned.

Much of China’s so-called ‘duplitecture’ craze is based around property projects in which developers hope that people will buy apartments in areas near tourist sites or scenic spots.

But interest has been mixed, forcing some property bosses to do deals with Tujia, China’s answer to Airbnb, to rent out apartments to visitors (see WiC294).

At least Haichang has experience of tourism, as the holding company for Haichang Ocean Park, a Hong Kong-listed operator of theme parks that runs eight amusement parks in China, with two more under construction in Shanghai and Sanya.

In the last Five-Year Plan domestic tourism was identified as a pillar industry, and tourism-cum-property projects have been encouraged with easier access to bank loans. But the downside is that lots of theme parks are chasing the same tourist dollar in China and analysts have flagged the risk of overinvestment in the sector (see WiC278).

Haichang Ocean Park went public in Hong Kong last year, with a prospectus that pointed to three years of profit growth before 2015. As of this week, it is worth HK$7 billion ($900 million), or 32 times its 2014 earnings. Its closest overseas peer, the New York-listed SeaWorld Entertainment, meanwhile, is trading at 74 times earnings.

But both Haichang and SeaWorld look pricey compared to China Travel. The state-owned tourism firm carries a price-to-earnings multiple of just 16. And two of the assets in its portfolio? You guessed it Splendid China and Window of the World…


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