In Shenzhen, a metropolis born of China’s economic prosperity, Paibang Village is a reminder of the city’s modest past and the challenges ahead for reviving the country’s property sector.
Paibang is what China calls an urban village, a labyrinth of low-slung apartment buildings and mom-and-pop storefronts connected by a maze of alleyways and narrow roads. There are hundreds of them in Shenzhen, a municipality of 18 million people next to Hong Kong, and thousands of such villages across China.
Now with China mired in an unyielding property crisis, policymakers want to revamp aging urban neighborhoods like Paibang to kick-start construction and spur local economies.
But as the halting rehabilitation of Paibang shows, it will not be a quick or easy fix.
Seven years ago, Paibang was chosen for an “urban renewal” by city officials, and in 2019 China Evergrande, one of the country’s biggest real estate firms, took control of the project. The company paid building owners for the right to demolish apartments and start clearing land for modern high-rises. Before the work could begin, Evergrande collapsed.
Evergrande then handed the project to Shenzhen Metro, a state-owned firm and top shareholder in China Vanke, another giant homebuilder. Now Vanke is facing its own cash concerns. Last week, Shenzhen Metro — and, by extension, the Shenzhen government — sought to calm investors by pledging to backstop Vanke.
All the while, construction in Paibang has been at a standstill. On a recent weekday, a glass-enclosed modern building that serves as the project headquarters, and still displays Evergrande signs, was largely empty.
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