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Yangpu residential plot sold at record price

A WHOLY-OWNED subsidiary of China State Construction Engineering Corp, which raised US$7.3 billion in July in the world's biggest initial public offering this year, today acquired today a 114,500-square-meter land plot in the city's northeastern Yangpu District for 3.72 billion yuan (US$544 million).

The land at New Jiangwan Town is designated for residential development, and was offered at a starting price of about 15,000 yuan per square meter but finally sold for 32,484 yuan per square meter – the highest residential land price in China.

"It's a super crazy price and will definitely leave a great impact on the city's already overheated housing market,'' said Xue Jianxiong, an analyst with E-House (China) Holdings Ltd, a major real estate services provider.

"With such a high price, buyers will naturally assume that home prices in Shanghai will continue to soar despite the fact that they already stand at record high levels.''

The developer may not be able to make any profit if homes built on this land plot are sold for less than 50,000 yuan per square meter, industry analysts said.

Currently, apartments in New Jiangwan Town are sold about 30,000 yuan per square meter while some villa projects there ask between 35,000 yuan and 45,000 yuan per square meter.

In fact, New Jiangwan Town has been notorious for its record-breaking land prices over the past few years.

Land pieces designated for home development in that area were sold at around 12,500 yuan per square meter in June 2007 and jumped to 20,000 yuan in November that year, beating all market expectations.


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