Skyscraper Mania Grips China as Ambitions Trump Economy

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Passengers on a ferry look at buildings in the Lujiazui district, including Shanghai Tower under construction, right, at dusk in Shanghai, China.

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Photographer: Tomohiro Ohsumi/Bloomberg

Passengers on a ferry look at buildings in the Lujiazui district, including Shanghai Tower under construction, right, at dusk in Shanghai, China. Close

Passengers on a ferry look at buildings in the Lujiazui district, including Shanghai Tower under construction, right,... Read More

Photographer: Brent Lewin/Bloomberg

Shenzhen's tallest building, the KK100 skyscraper, left, towers at over 400m above residential and commercial buildings in the Luohu district of Shenzhen, China. Close

Shenzhen's tallest building, the KK100 skyscraper, left, towers at over 400m above residential and commercial... Read More

Photographer: Zhou Sihan/Imaginechina

A watermelon farmer rides his motorcycle through the land where Sky City is supposed to be built in Changsha, China, on July 1, 2014. Close

A watermelon farmer rides his motorcycle through the land where Sky City is supposed to be built in Changsha, China, on July 1, 2014.

Photographer: Brent Lewin/Bloomberg

The Guangzhou International Finance Center (IFC), center, stands in the central business district of Guangzhou, China. Close

The Guangzhou International Finance Center (IFC), center, stands in the central business district of Guangzhou, China.

The eastern Chinese city of Suzhou isn’t even the biggest in Jiangsu province, yet it’s joining a national rush for the sky with what’s slated to become the world’s third-tallest building.

By 2020, China may be home to six of the world’s 10 highest skyscrapers, including Suzhou’s 700-meter (2,297-foot) Zhongnan Center. Developers finished 37 structures higher than 200 meters, or about 50 stories, in China last year, the most in the world, according to the Chicago-based Council on Tall Buildings and Urban Habitat, a non-profit organization that maintains the world’s largest free database on tall buildings.

China is witnessing a skyscraper boom, with lesser-known cities like Suzhou vying to erect ever-bigger structures and counting on the prestige and potential commercial benefit those mega-buildings may bring. Construction has been fueled by a tripling in property values since 1998 and government policy that moved 300 million people -- almost the entire population of the U.S. -- into cities since 1995.

“What’s happening in China is similar to what happened in the U.S. 80 to 100 years ago, on a different scale,” Antony Wood, the council’s executive director, said in an interview in Shanghai. “Cities are competing both within China and also globally for attention and for the appearance that they are first-world.”

Mini Manhattan

The council says Suzhou’s will be the world’s third-tallest building when it’s done in 2020. Other Chinese cities planning or building skyscrapers that could join the world’s tallest include Shenyang in the northeast, Wuhan, along the Yangtze River, and Tianjin, a metropolis 68 miles (109 kilometers) southeast of Beijing that’s planning a replica of Manhattan.

None of the towers would exceed the world’s current tallest building, Dubai’s Burj Khalifa, or the one set to surpass it -- Jeddah, Saudi Arabia’s planned Kingdom Tower, slated to be a kilometer high. What China lacks in height it makes up for in quantity. All together, China, Hong Kong and Taiwan already have half the world’s 20 tallest buildings.

Premier Li Keqiang has championed urbanization as a “huge engine” for expansion as he seeks to shift the world’s second-largest economy toward a model that relies on consumption rather than investment and exports. The Communist Party predicts that more city-dwellers and their higher wages will mean more money spent on televisions, travel and new homes.

‘Iconic Towers’

“With roughly 250 million people set to move into Chinese cities in the next decade or so, the pace of urban construction -- including road, rail and water infrastructure and cultural institutions, in addition to tall buildings -- has outstripped any previous period in human history,” the tall-buildings council said in a report that Wood provided to Bloomberg News. The full report will be released when the council holds its annual congress in China this September.

The skyscraper build-out comes as China’s leaders grapple with the best way to build cities and accommodate that swelling urban population. The National Development and Reform Commission is studying a plan to improve city planning by limiting sprawl, China Business News reported today.

China’s skyscrapers are no guarantee that the surge in property values will continue. New-home prices fell in 55 of 70 cities in June, according to government data. High-rise manias in New York, Kuala Lumpur and Dubai all preceded economic slumps.

Economic Reality

The planned Sky City skyscraper in central Changsha may become a symbol of the bursting property bubble as well as the skyscraper boom. Broad Group, an air-conditioner maker, once promised to erect the 838-meter building in less than a year -- by April 2014. For now, the site is sprouting only watermelons.

“China will get to the point where economic reality -- whether that’s on the level of a single developer, local government, or the central government -- will become a big factor that overtakes ambition,” Wood said.

Still, Suzhou may find comfort in a 2011 study by three American university professors, “Skyscraper Height and the Business Cycle,” which found no support for the so-called “Skyscraper Index” -- the theory that the most intense competition for the tallest towers occurs just before a business downturn.

Human Ambitions

There is no sign yet that ambitions have been crimped by a weaker property market or projections of slower economic growth. A plan announced last month by the U.K. firm Chetwoods Architects would take on Jeddah’s Kingdom mega-skyscraper with a development in Wuhan featuring a pair of towers.

Wuhan is a transportation hub in central China in the midst of its own real-estate frenzy. Last month, ECA International, a consulting company, ranked the city Asia’s 29th most-expensive for expatriates, beating Mumbai and Kuala Lumpur. Wuhan is already planning a tower of more than 600 meters under construction by China’s Greenland Group.

“Humanity has the ambition to do what it can’t do; part of that is to build the tallest buildings,” Wood said. “Many of the iconic towers now rising in China have lent world recognition to cities that relatively few Chinese -- let alone Westerners -- were previously aware of,” Wood said.

To contact Bloomberg News staff for this story: Bonnie Cao in Shanghai at bcao4@bloomberg.net

To contact the editors responsible for this story: James Hertling at jhertling@bloomberg.net Tomoko Yamazaki, Nicholas Wadhams

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