The public supporting facilities of the residential community will be paid for by the government in the future.
On November 5, 2026, bidding kicked off for two residential land plots in Tuofangying, Jiangtai Township, Chaoyang District, Beijing. Among them, the No. 55 combined plot has a planned floor area of approximately 97,900 square meters, with a starting price of 4.5 billion yuan; the No. 56 combined plot has a planned floor area of approximately 73,400 square meters, with a starting price of 3.8 billion yuan.
Previously, the two land plots belonged to one land transfer project, which was originally scheduled to complete bidding on September 3, before the transfer was suspended. On October 16, the project was split into two separate plots for re-listing.
After the split, the total planned floor area of the two plots remains approximately 171,300 square meters, and the total starting price has increased by 779 million yuan. The stadiums and designated public parking spaces that were originally required to be built free of charge by the winning bidder are now arranged to be constructed by the winning bidder and repurchased by the Chaoyang District Bureau of Sports.
Similar arrangements have also appeared in other land plots. For part of the commercial and public parking facilities of the Fenzhongsi project in Fengtai, Beijing, the winning bidder will be responsible for construction, and the designated enterprise of the district government will purchase the whole lot at cost price. For the relocation project of the underground passage, public green space and switching station attached to a residential land transfer project in Putuo, Shanghai, the district government will provide funds to the project initiating entity, and the winning bidder will be responsible for the whole-process agent construction.
"The construction cost of public supporting facilities is an expenditure that real estate enterprises must take into account when calculating land costs," a regional head of a state-owned real estate enterprise told the Economic Observer. This part of the cost will dilute the project profit. When sales are smooth, real estate enterprises can accept it; after the de-stocking cycle is extended, the impact of this expenditure on investment decisions will increase accordingly.
On August 28, three departments including the Ministry of Housing and Urban-Rural Development issued the "Notice on Improving the Commodity Housing Sales System" (hereinafter referred to as the "828 New Policy"), which raised the pre-sale threshold for new projects and strengthened the supervision of sales funds. Who will pay for the public supporting facilities, when the payment will be made, and when the facilities will be delivered have also become issues that real estate enterprises need to reconsider when arranging project funds.
Who Will Bear the Cost
The listing documents of the Tuofangying plots show that the construction and installation cost control standards for the 0001 and 0018 sports facilities of the No. 55 plot are 15,000 yuan/square meter and 9,000 yuan/square meter respectively; the total construction and installation cost of no less than 300 public parking spaces and related facilities on the second underground floor of 0018 is about 75 million yuan. The construction and installation cost control standard for the 0002 sports facility of the No. 56 plot is about 13,000 yuan/square meter.
Roughly calculated according to the above standards, the construction and installation cost of the 0001 stadium on the No. 55 plot is about 486 million yuan, the 0018 stadium is about 77 million yuan, and the total cost including the underground public parking lot is about 637 million yuan; the construction and installation cost of the stadium on the No. 56 plot is about 248 million yuan. The total construction and installation cost of the above public supporting facilities of the two plots is about 885 million yuan.
After the public supporting facilities are changed to paid repurchase, the total starting price of the land has also increased. The starting price of the project for the first listing was 7.521 billion yuan, and the total starting price of the two plots after re-listing reached 8.3 billion yuan, an increase of 779 million yuan.
According to the listing documents, the sports facilities and designated parking spaces of the two plots will be constructed by the winning bidder and repurchased by the Chaoyang District Bureau of Sports, and the funds will be paid in batches according to the actual progress of the project. The 0001 facility of the No. 55 plot must be completed for acceptance and delivered before December 2028, and the 0018 facility will be delivered simultaneously with the residential buildings; the 0002 facility of the No. 56 plot must be delivered before May 2028.
The above-mentioned regional head of the state-owned real estate enterprise believes that although the land price has increased, the repurchase arrangement has changed the way real estate enterprises bear the cost of public supporting facilities. In the past, this part of the cost was digested by real estate enterprises themselves, and enterprises would try their best to compress expenditures; after the change to paid repurchase, real estate enterprises have corresponding income sources, which also provides space for improving the construction quality of supporting facilities.
In his view, the logic for real estate enterprises to calculate project returns has also changed accordingly. When supporting facilities are built free of charge, the relevant construction and installation costs are the cost expenditure of the project; after the paid repurchase is implemented, real estate enterprises get an additional return fund, based on which they can calculate the income and profit of the agent construction business.
The Fenzhongsi plot in Fengtai, Beijing is scheduled to start bidding on November 17, with a planned floor area of approximately 131,700 square meters and a starting price of 4.6 billion yuan. In addition to residential buildings, the project also includes facilities such as commercial spaces and public parking lots.
The listing documents stipulate that the 0104 commercial plot and 0101 public parking lot will be constructed by the winning bidder, and the designated enterprise of the Fengtai District Government will purchase the whole lot at cost price. After the purchaser obtains the corresponding above-ground and underground properties, it must hold them until the expiration of the land use term. There is another 15-meter-wide east-west community road in the 0101 plot, which will be constructed by the winning bidder and then transferred to the Fengtai District Urban Management Commission free of charge.
The above-mentioned plot in Putuo, Shanghai adopts the mode of government funding and agent construction by the transferee. The supporting projects include the south Shiyi Road, the H-shaped underground passage and affiliated facilities under Liquan Road, two public green spaces, and a 10kV switching station relocation project. The Putuo District Government will provide funds to the relevant project initiating entity, and the transferee will be responsible for the whole-process agent construction.
The Economic Observer checked the land bidding and listing documents of some first- and second-tier cities and found that it is still relatively common for public supporting facilities to be transferred free of charge after being constructed by the winning bidder. At present, paid agent construction and repurchase are mainly applied to some plots in some cities, and are not widely adopted even in Beijing and Shanghai.
A person from the Beijing Municipal Commission of Planning and Natural Resources told the Economic Observer that the scale, construction and transfer method of public supporting facilities are mainly determined by the district government where the land is located according to the land market situation.
Increase and Decrease of Public Construction Tasks
The above-mentioned regional head of the state-owned real estate enterprise introduced that residential projects are attached with many types of supporting construction tasks, and the methods of bearing costs and transferring properties are also different.
Supporting facilities such as roads, greening, civil air defense, and public squares mainly serve the project and surrounding areas, most of which are funded by real estate enterprises and transferred free of charge as agreed. Facilities such as schools, hospitals, stadiums, and public transport stations are mainly for providing public services, and some of them also have operating functions. In the past, most of them were also funded by real estate enterprises and transferred free of charge after construction, and repurchase was not common.
Supporting properties such as community commercial and office spaces, public rental housing, talent apartments, and resettlement housing are used for operation, leasing and resettlement respectively. In the actual operation of projects, paid repurchase of such properties is relatively common, and there are also cases of free transfer.
The regional head said that the situation of urban renewal and old renovation projects is more complicated. In addition to monetary compensation, the original ownership collective organizations or enterprises often require to obtain a certain scale of commercial or office space after the project is completed, and such properties are sometimes included in the project supporting construction tasks.
After the "828 New Policy", some cities have begun to reduce or relax the supporting construction requirements for residential land, in addition to adjusting the transfer methods of supporting facilities.
On October 21, the Shiyan Municipal Bureau of Housing and Urban Renewal and other departments jointly issued an implementation opinion, which clearly stipulates that for commodity residential land with transfer contracts signed on August 28 and later, the supporting construction requirement for talent apartments will be cancelled; for plots with a planned residential floor area for plot ratio calculation less than 150,000 square meters, it is not necessary to build kindergartens as supporting facilities.
A person in charge of a private real estate enterprise in a fourth-tier city told the Economic Observer that his city requires every community to build public rental housing. This not only increases construction costs, but also squeezes the salable area. "Overall, the impact on net profit is about 10%."
He believes that if the local government can also cancel or relax some supporting construction requirements, even if the existing house sales system is implemented and the capital occupation cycle is relatively long, real estate enterprises are still willing to acquire land as long as the project has sufficient profit margin. The current difficulty is that the total profit is only 10%, which is spread over a cycle of four to five years, and there is basically no profit. He currently has seven or eight projects under construction, and three other plots have not been developed. In this fourth-tier city, the development cycle of an existing house project is usually about five years. Even if the three plots are developed in a staggered manner, "it can take seven or eight years, so there is no rush to acquire new land."
The above-mentioned regional head of the state-owned real estate enterprise said that adjusting the transfer method, content and proportion of public supporting facilities is intended to reduce the investment burden of real estate enterprises and attract more enterprises to participate in land bidding. Enterprises will incorporate land prices, supporting construction costs and payment arrangement of return funds into the calculation together.
Changes in Capital Priority
The 828 New Policy requires that commodity housing projects on newly transferred land give priority to the implementation of the existing house sales system; for projects that choose pre-sale, the single building of the new project must complete the main structure capping. Funds such as down payments, individual housing loans and deposits paid by home buyers will enter the supervision account, and the supervision will be lifted after the project is completed and accepted and the relevant supporting facilities meet the delivery conditions.
The issued local implementation opinions have relatively consistent requirements for capital supervision, but the sales methods are different. Some plots clearly require existing house sales, and some cities give the choice to the land-acquiring real estate enterprises.
The raised pre-sale threshold and stricter supervision of sales funds require real estate enterprises to arrange funds for a longer cycle for land, residential main body and supporting projects before the sales return funds can be freely disposed of. The larger the volume of public facilities, the more construction investment needs to be covered. The government paying the agent construction or repurchase funds according to the progress can provide funds for the corresponding projects and reduce the pressure of real estate enterprises to advance funds.
The scale, cost and payment method of public supporting facilities not only affect the cash flow of a single project, but also affect the subsequent land acquisition and re-investment capacity of real estate enterprises. When transferring land, local governments need to strike a balance between land revenue and market transaction performance.
Some adjustments have been reflected in the land payment conditions. According to Beijing's implementation opinion on the 828 New Policy, for land transferred after August 28, the down payment shall not be less than 50%, and the remaining balance can be paid off within two years without interest.
After the Tuofangying project is split, the starting price of the plots has been reduced from the original 7.521 billion yuan to 4.5 billion yuan and 3.8 billion yuan, lowering the capital threshold for enterprises to participate in a single project. The two plots also set up a deposit sharing mechanism, so that real estate enterprises participating in the bidding of both plots can pay 760 million yuan less in deposit.
The construction plan of the municipal facilities around the Tuofangying plot has also been advanced. The planned No.1 Road connecting the two sides of the Ba River is scheduled to be completed 9 months in advance; the relevant section of South Jiuxianqiao Street is advanced by 19 months to match the completion of residential buildings and the delivery of supporting facilities.
When entering the construction stage, the payment time of the repurchase funds directly affects the scale of funds advanced by real estate enterprises. In the past, even if the government agreed to repurchase supporting properties such as talent housing, resettlement housing and public rental housing, real estate enterprises still needed to invest a lot in the early stage of construction, and some projects had not received the repurchase funds two or three years after delivery.
A person from a medium-sized private real estate enterprise told the Economic Observer that his enterprise has not developed new projects for many years, but up to now, the various repurchase funds that have not been paid by local governments are still at the level of tens of billions of yuan. According to his understanding, some large real estate enterprises have developed more projects, and the scale of such receivables is even larger.
This person said that government repurchase funds involve fiscal budget arrangement and approval by the people's congress. Even if included in the budget, the actual collection of funds by enterprises is still affected by the local fiscal situation.
Some plots in Shanghai adopt the mode of government investment and agent construction by real estate enterprises, and some plots in Beijing stipulate that repurchase funds are paid according to the project progress, both of which move the payment arrangement forward to the construction stage. Compared with waiting for repurchase funds after completion and transfer, these arrangements help reduce the funds advanced and capital occupation of real estate enterprises.
A person from a leading real estate enterprise told the Economic Observer that the 828 New Policy has been implemented for a short time, and the projects under the new policy have not yet started, so there is a lack of actual cases to verify its impact on capital pressure. He said that in the past, enterprises usually arranged project funds on an annual basis, but now when making capital plans, they usually need to cover a period of three to five years.
This article is from the WeChat official account "Economic Observer", written by Tian Guobao, and authorized for release by 36Kr.