Devott Insight: Forecasting the Thirteenth Five-Year Plan The Six Trends of Development of China Industrial Parks
Source: Devott View: 212 Date: 2015-03-07

As the important platforms of city's economic development and cultivation of industry, the industrial parks play important role in the process of impelling the transformation and development of China city and the development of strategic industry, and also enjoy the special supports such as special funds, preferential policies and institutional innovation. Since the reform and opening up, the development of industrial park in China has also experienced different stages which are from the Industrial Park to the Science Park, and then to the Business Park. Devott believes that the development of China Industrial Park has entered into the industrial complex stage of 4.0, and the brand new characteristics and development trend appear on the aspects of industrial kernel and operation mode with the deepening of Industrial Revolution of Science and Technology and the frequent adjustment of national strategy and policy in recent two years. In 4.0 stage, the development of parks specially emphasizes the relationship between the industry and the city, the technology service industry is a natural park urbanization industrial kernel choice, the industry-city integrated development mode which develops the "City" by the "Park" and promotes the "Park" by the "City" will play an important role on creating the new kernel of city economy and constructing the new urbanization in the future "Thirteenth Five-Year Plan".                                                                                                                                                       

Trend One: The New Trend of "New City Construction" Under the New Situation

Looking back to 2014 in which the national strategies and relevant policies are frequent, the strategic significance for the development of "Industrial New City" is superior to the past. With the issuance of concepts of the central "Urbanization", "Integration" and "Economic Belt", "Industrial New City" becomes the key power for achieving the regional development, the "Industrial New Cities" of various regions appear like mushrooms after rain. Meanwhile, with the constant deepening of industrial structure adjustment and land structure adjustment from the central government, it is more and more difficult to get the new city construction projects around the outstanding cities (suburban projects of first-tier cities and central location projects of several economic circles such as Yangtze river delta), and the projects of third-tier and fourth-tier cities frequently bother the markets. But with the deep adjustment of real estate, the traditional new city development mode suffers great challenge, the adjustment of real estate makes the new city construction of third-tier cities and below encounter great obstacles. Many new phenomena appear under the new situation, and this makes the development mode of "Industrial New City" experience great reform in 2014, and it will become the first problem needed to be solved by various cities and parks for impelling industrial development during the period of "Thirteenth Five-Year Plan".

Trend Two: "City Operation" Is Put Up to the Unprecedented Height

The development of industrial new city is obviously divided into two main lines which are the "City Operation" and the "City Construction", and the "City Operation" is put up to the unprecedented height. The "City Operation" includes "City Definition", "City Marketing" and "City Management". With the increases of "Industrial New Cities", the "City Definition" becomes the key factor which distinguishes the level of new city, more and more new cities become the significant projects of China through "City Definition" (for example: the National East Middle West Demonstration Areas of Lianyungang, the pilot Areas of Yangtze River Delta Integration of Pinghu, Zhejiang). Being the national strategy brings huge opportunities to the project, and it gets huge tilt of China on aspects of infrastructure investment, we can say that "City Definition" determines the future development space of the new city. On the other hand, high-grade "City Definition" improves the regional land value, this value promotion makes huge advantages for the aspects of financing and guarantees in the future. And different "City Orientations" will also choose different "City Marketing" and "City Management" models in the future. The key point of "City Orientation" lies in the industry orientation, the differences of industry orientation determines the different aspects which we conform to the national strategy.

Trend Three: "Weakening the Orientation of Real Estate" Becomes the Trend

The year 2014 is a year in which the real estate is deeply adjusted, especially the real estate markets of third-tier and fourth-tier cities are devastated. Most people hold positive attitudes towards the future trend of real estate, but it is obviously very difficult to rely on the sales of real estate to balance the funds of city development in short period. The development of new city itself is divided into three aspects which are "Land Development, Real Estate Development and Content Management", it is possible to "Weaken the Orientation of Real Estate" to organically separate these three aspects. Certainly, "Weakening the Orientation of Real Estate" doesn't fully get rid of real estate, but it relies on the design of new business structure to make different cooperation main bodies undertake different fund risks on one hand, and on the other hand make the funds needed to be balanced in short period be able to be balanced through the long-term operation.

Trend Four: The Industry Goes Ahead, the Planning Leads

The development core of "Industrial New City" actually lies in the industry, especially the service outsourcing industry, on one hand it is very close to the market, on the other hand it has the space which can be deployed in different cities of China, even in the third-tier and fourth-tier cities which originally don't have the industrial base, we also find its development opportunity, for example, there is a biggest call center park of China in Yangzhou, and Yangzhou was used to be a traditional agricultural city, so on the basis of this, the so-called ghost city and empty city might be the good carrier for the industrial new city development of the next stage, because this carrier has already had the sufficient supporting for the people and enterprises.

When the real estate is popular, very few people care about the industrial operation, but the enterprises which did deployment at that time have achievements now, CFLD is the typical representative (the gross profit proportion of industrial service income surpasses 30%, the annual income is over 5 billion). But the industrial operation income is not only the return of attracting investment, but also includes the following contents: tax sharing, return of attracting investment, incubation benefits, park operation and industrial development benefits. When carrying on the construction of new city, we not only bring tall buildings to the government, but also invisible industrial composition, we not only gain the land benefits, but also the industrial benefits.

The overall planning of traditional meaning becomes the functional docking and landing from the dominant position, the general planning provided by the planning organization cannot meet the planning requirement of the general meaning. From the city planning, strategic planning, industrial planning, overall planning to the controlling planning, a series of planning will be considered in one logic, "Unification of Many Planning" becomes the new requirement.

Trend Five: 2.5 Industry Is Continuously Reinforced

2.5 industry is an industry which highly saves and utilizes the land, with the high standard of industrial land in Shanghai, Zhejiang also issues the policies on the saving and utilizing of industrial land, many cities of China successively issue the similar policy, and this makes the governments of outstanding cities change attitude towards the industrial land. 2.5 industry is the industry which highly meets the city image and highly concentrates the excellent talents, the high consumption brought by 2.5 industry will become the new growth point of city.

Meanwhile, as the main content of modern service industry, 2.5 industry could not only provide elements for the tertiary industry, but also provide support for the secondary industry, and it naturally becomes the core industry in the process of industrialization to urbanization.

Trend Six: The Advanced Manufacturing Industry Becomes the Support of City Development

A large number of excellent cities and new districts are abandoning the traditional manufacturing industry, but it is not to say that the government is abandoning the manufacturing industry, the advanced manufacturing industry featured by industry 4.0 is becoming another key power of new city's development (industry 4.0 refers to the change of basic mode which is changing from the centralized control to the decentralized enhanced control, eventually to establish a highly flexible, personalized and digital product and service production mode). But the urban form of advanced manufacturing industry determines its inevitable trend of "Weakening the Orientation of Centralization", under the major premise of modular development, it is the mission of advanced manufacturing industry to make the advanced manufacturing industry "Weaken the Orientation of Centralization" on the aspect of geographical location and "Do Centralization" on the aspect of industrial structure in the modular combinations, and form the dual systems of industrial development and city development.

The "Big Integration" brings the "Big Participation" of all sectors of society. The thing that how we regard the "City" determines the differences of different cities' operators, do we regard the city as a big development project of real estate, or regard the city as a stage? The orientation of city operators determines its different developing forms. Especially in the face of the severe land audit form of 2014, the government is hard to carry on the large-batch of action of "Transaction Under the Table", and this also makes it hard to develop the first-class land which is traditionally for the purpose of getting land, and also makes it more difficult to implement the government's action of simply selling land to attract the first-class land developers. The city anew returns to the stage of resources, and also further judges the capacity of government on the urban operations. The year of 2014 is not the changing year of real estate, but the new beginning of the development of real estate, the city operators will also face the new competition, the value design of business mode will become the key point of distinguishing the city's operation enterprises. Different from the value convergence mode of traditional real estate, the field of city operation is an industry which has huge value differences. It can be predicted that the dual structure of enterprise value and project value will become the important support of the rapid development of operators.

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