(Yicai Global) July 26 -- Two state-owned enterprises in Shanghai have won the open bid for two parcels of land allocated for rental residential projects put out to tender by Shanghai city government. The transaction price was 84 percent lower than that of the nearby land for an ordinary residential project sold a year ago.

Among the two parcels of land for rental residential housing tendered out, one is located in Pudong New Area, with a land area of about 6.5 hectares, and construction area of about 130,000 square meters. Shanghai Zhangjiang (Group) Co. won the bid for the land with a total transaction price of CNY724 million (USD 107 million), and transaction unit price of CNY5,568 yuan (USD824.74) per square meter, Xinhua News Agency reported yesterday.  

The second parcel is located in Jiading New Town in Jiading district with a land area of about 2.85 hectares, and construction area of 71,300 square meters. Shanghai Jiading New Town Development Co. won the bid for the land with the transaction price of CNY424 million (USD 63 million) and transaction unit price of CNY5,950 (USD 881.32) per square meter.

Relevant departments of Shanghai clearly stated that the right to use of the two parcels of land for rental residential housing is 70 years, which can only be used for rental purposes, not for sale.

The land for rent-only residential housing that Shanghai city government launched will not only meet the greater demand for local talent apartment construction, but also help alleviate the pressure on commercial housing price rise, Yan Yuejin, research director of a think tank at the E-House China R&D Institute, a real estate research agency, said.