The Development Model Research Of The Bund Financial Convergence Region

In March2009, the State Council approved and issued the Opinion onspeeding up developing the Dual Centers of Shanghai, which states theambitious target: to basically complete establishing the internationalfinancial center adaptive to the country's economic strength and to theRMB's global standing by the year2020. Following the Opinion from theState Council in the same year, Shanghai government issued theImplementation Opinion and the regulation of carrying forward buildingthe international financial center in Shanghai re the Dual Centers andproposed the strategic target of speeding up planning and building thefinancial convergence region with the core of "one city" and "one region".One city is the Lujiazui financial city, one region is the Bund FinancialConvergence Region (the BFCR). To develop the BFCR, Huangpu Districtgovernment worked out the development guideline, targeting to make theBFCR the influential international assets management center, capitalmanagement center and professionally financial service center, which canbe complementary and synergetic to the Lujiazui financial city. Meanwhile,to starting the development, the Bund Investment Group (BIG) wasestablished as the platform to realize the BFCR' s strategic plan andpositioning.The BFCR has been corresponding with the state's regionaldevelopment strategy, gaining the support from the Municipal Governmentand established the development company for implementation. However,series of problematic issues exist, e.g. the ambiguous development model,the unclear positioning of the development company, how to be adaptive tothe macro economic environment and surpass the advanced with themarket way, how to overcome the development company's drawbacks of capital, experiences and capabilities and how to improve the developmentefficiency and quality.To solve the above problems and speed up the BFCR development,this article started from looking for the suitable master-developing models,analyzing the development models and characteristics of the urbandevelopment cases in the US and in the UK, summarizing the domesticurban development models and case studying the city refurbishment ofDockland in London, the rebuilding of Fort Gillem in the US and thedevelopment of Lujiazui financial and trading zone and Beijing financialstreet. Therefore summarized6experiences world wide:(1)Master-developing has been widely accepted;(2) Master-developers needthe enough power of control over the region;(3) Land, as the mainresource, is used to manage the capital by the master-developers;(4) It is along-term issue to improve the capability of the Master-developers;(5)The sustainable capital supporting channel is necessary;(6) Thegovernment participating and policy supporting are the importantguarantee. Due to the conversion into compulsory public auction from theformer appropriating and the negotiable transferring in China, the aboveexperiences on land management cannot be used for reference only.Secondly, to eliminate the adverse impacts on the current landtransferring policies, the article analyzed the PPP model and itsorganization, structure, necessity to urban development, case studied theBrooklyn Atlantic center in New York, Urban village regeneration in China,Lujiazui development, and concluded that besides the model ofMaster-developing, PPP should also be integrated.Thirdly, based on the reality conditions of the BFCR and the BIG,applying the research conclusion derived from the above parts and theeconomic theories, brought the model of Master-developing+PPP forBFCR and discussed with details on the positioning and functions,organizational structure, cooperation structure, operation mechanism andworked out the development model design as well as the feasibility of BFCR development.Fourthly, aiming at solving the main problems of BFCR developmentand main functions of BIG, applying the model of the Master-developing+PPP, suggested5points for implementation:(1) International tendering,unified planning and phasing adjustment;(2)Cooperating closely withgovernment to win the supportive policy;(3) Relying on the complexprojects to improve property development;(4) Introducing the originalowners of properties for old building regeneration;(5) Building the capitalplatform for multi-channel financing.