(Yicai Global) Aug. 29 --Shenzhen will keep up its efforts to build up its rail transit network in coming decades to 33 subway routes with a total mileage of 1,335 kilometers, about five times today's operational track length.

Shenzhen Metro Group, the constructor and operator of the city's metro lines, recently announced this news as it celebrates its 20th anniversary.

Shenzhen Metro now runs seven subway routes with an overall expanse of 265 kilometers, with a further 273 km under construction. Beijing and Shanghai lead the pack in China with total operating subway mileage topping 600 kilometers, but the southern city adjacent to Hong Kong is hard on their heels.

Shenzhen is still undergoing a rapid population rise, and expansion of the subway network can not only alleviate the traffic pressure, but will also help cut back on vehicle emissions and noise and other pollution, while enhancing transport efficiency, Wang Guowen, director of the Center for Logistics and Supply Chain Management of the Shenzhen-based government think-tank China Development Institute, told Yicai Global.

The booming tech and commercial hub is already at the limit of its breakneck expansion and is beset by an extreme scarcity of land resources, so the construction of subway routes will also foster development of underground commercial spaces, Wang added.

As to the impact of subway construction on the local real estate market, "Metro construction will drive up housing prices on the city's fringes," He Qianru, director of national research center of Hong Kong's Midland Realty, told Yicai Global. "As the number of subway routes grows, the price gap within and without the main city area will narrow, but prices are less likely to even out," He added.

"Shenzhen is financially well-positioned to support the enormous rail transit system," Wang noted, referring to funding sources for the massive construction plan. Government investment mainly financed previous metro construction in the city, but "the subway represents a public goods program with returns, but it is not totally public benefit, so multiple innovative investment models are suitable, Wang said.

The simultaneous implementation of more programs renders resort to PPP and other modes and mechanisms more viable," he added.

Editor: Ben Armour