Tag Archives: property rights

can renters become stakeholders in shenzhen?

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I like meeting and talking with visiting urbanists because the conversation is refreshingly straight forward about constructing society (via environmental interventions). Who are the stake holders, they ask. Where can we find them? What should we ask them? These clear and solid questions help me think more precisely about Shenzhen because identifying stake holders entails (1) acknowledging competing rights to the city and also (2) mapping the fraught and unformed territory of Shenzhen identity; who does have rights to this city of immigrants? And how did might they claim them?

Today, I’m thinking about approaching these questions through the construction and allocation of rental property.  Why do urban village handshakes — despite constituting the demographically significant residence in the city — why don’t they transform migrants into stakeholders? Continue reading →

laying siege to the villages: xixiang and fuyong

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A five-part essay, “Laying Siege to the Villages” has been published online at Open Democracy. Here’s part four, which discusses informal urbanization beyond the Second Line (erxian).

4. Informal Urbanization in the Outer Districts: National Highway 107

Shenzhen township and village enterprises (TVEs) in the outer districts (formerly New Bao’an County) were quick to take advantage of reform policies. By 1985, village-teams, township brigades, and the recently re-established Bao’an County government had already registered over 50 industrial parks (Map 6).

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Map 6: Industrial Urbanization in New Bao’an County, 1985

Nevertheless, this massive social restructuring occurred outside and despite municipal urban planning (Map 7). A comparison of these two maps reveals three important features of informal urbanization in Shenzhen. First, the total area of Shenzhen’s informal industrial urbanization was over four times greater than planned urbanization in inner districts (original SEZ). Second, urbanization in the outer districts occurred outside official urban planning. Moreover, the density of industrialization along National Highway 107 becomes on the 1986 Plan an incomplete red thread. Indeed, as targets of urban planning, the outer districts did not appear in official maps until the release of the 1996 Shenzhen Comprehensive Plan. Third, the scale of development in the outer districts indicates the high level of informal organization in the villages. Informal urbanization did not arise sui generis, but through the redeployment of TVEs, which did not only represent the economic interests of the collective but also traditional identities and social constituencies.

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Map 7: 1986 Master Plan for the Shenzhen Special Economic Zone Transposed onto the 2013 Shenzhen Municipal Map

In addition to the New Bao’an County TVEs, the outer districts also saw the development of private stock companies formed by alliances between individual villagers and investors, often from Hong Kong or an Overseas Chinese community. The diversity of ownership, notwithstanding, all of these enterprises engaged in low-tech labor-intensive assembly manufacturing. The factories themselves were long, concrete buildings, usually 4-6 stories in height. These buildings usually had electricity and water hook-ups, and depending on the complexity of assembly, individual tables for detail work. Outside firms contracted a TVE to assemble a product according to spec. Earliest manufactured goods included textiles, toys, and cheap electronics. These early industrial parks also included 4-6 story dormitories for migrant workers. Dorm rooms were narrow, and fitted with four bunk beds. Opposite the door was a small window, while along the remaining walls two bunk beds were placed back-to-back. There was enough space between the bunk beds for residents to walk to their bed. Consequently, most conversations occurred sitting on a bed or outside on the lawn. Importantly, these factory complexes were built either along National Road 107 or the railway, along which goods were transported to the port of Hong Kong, where in turn the goods were shipped overseas.

In the early 1980s, when the Shenzhen TVEs opened, there were no other manufacturing jobs available to rural workers, who were still tied to collectives and mandatory agricultural production quotas through hukou status. This meant that the Shenzhen TVEs had labor reserves throughout Guangdong and neighboring provinces, where rural workers who were effectively excluded from wage labor. The number of migrants who took advantage of these opportunities constituted the Shenzhen population boom, transforming the landscape in three important ways. First, more people came than there were jobs and by extension, dormitory space. This created an immediate need for rental properties. Second, the increasing population also needed food and social services, which in turn created more jobs for migrants across sectors, but primarily in construction and service industries. Third, urban construction this area was largely informal. By the time that Shenzhen Municipality had annexed New Bao’an County in 1990, local collectives had emerged as the de facto urban planners in the outer districts. Moreover, when considered in terms of population and territory, urbanization in the outer districts constituted the primary form of urbanization in Shenzhen. Moreover, by the mid-1990s, many domestic and international companies chose to rent use rights from the collectives and build campuses in the other Districts, especially Longgang near the railway. As of 2013, high profile electronics manufacturers in Shenzhen included Foxconn, Tencent, and Huawei.

The fuzzy nature of ownership rights over-determined the haphazard direction of urbanization in the outer districts. Indeed, throughout Shenzhen, the foresight of a collective leader and the willingness of members to coordinate development has shaped the quality of life in specific villages. In the post Mao era, land ownership rights belonged to the collective, while “use rights” were delegated to members of the community. This slippage provide a brief window of opportunity for individual villagers to engage in individual profit-seeking activities, however, the most successful enterprises belonged to the county, townships, and villages that expropriated use rights by exerting their ownership rights. Indeed, conflicts between Shenzhen Municipality and its “urban villages” have also arisen due to the distinction between ownership and use rights. As of 1992 in the inner districts and 2004 in the outer districts, Shenzhen Municipality owned all land within its borders. However, through housing and industrial parks, the collectives continued to exercise use rights. Indeed, since 1992 and 2004, villages and developers have been negotiating compensation for transferring these rights; Shenzhen Municipality has mediated these transfers through its Master Plans.

下沙陈杨候王庙: mapping the transition of property rights in shenzhen

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Dedicated to Chen and Yang, a scholar and general, respectively, the Xiasha Houwang Temple 候王庙) is worth a visit and not only because these kings-in-waiting represent the Confucian ideal of uniting literary and military talents in governance, but also because they remind us that the contemporary figures of “high intellectual (高知)” and “high cadres (高干)” have historical president. What’s more, a glance at the plaque of sponsors suggests the extent to which reinvented traditions have been incorporated into Shenzhen’s urban village renewal projects. In addition to Xiasha Village Holdings Limited CEO, Huang Chaoying, CEOs from the various companies involved in Xiasha renewal also donated to temple construction, including Chen Hua (CEO Kingkey – 3 million yuan); Huang Chulong (CEO Galaxy – 2 million yuan); Huang Kangjing (Lvgem – 2 million): and Huang Guangmiao (CEO Centralcon– 2 million).

These four Shenzhen based conglomerates have a been major players in the implementation of the Municipality’s post 1996 urban plan, with investments that began either as a joint venture with an urban village or winning a bid from the government. Over time, these conglomerates have emerged become active in larger projects, participating in this second “village urbanization” effort and thus extending their holdings through collaboration with other Shenzhen urban villages as well as extended holdings throughout neidi. Kingkey, of course, is best known for the KK 100 in Caiwuwei, but also built the upscale mall, KK Baina in the reclaimed Hongshuwan area. It began as a Luohu developer, most notably the Jingdu Hotel, near the train station. Within the past decade, Kingkey has also expanded to open branches in Tianjin, Beijing, and Zhejiang.

The three other developers also followed this path – from developing buildings or housing complexes in a particular district (Kingkey began in Luohu, while Galaxy, Lvgem, and Zhongzhou had their start in Futian)  through urban village renovation (negotiating to lead the renovation of entire urban villages) to national player. All were formed in the early 90s, when Shenzhen began dismantling the State’s benefit housing system. The key point about the rise of real estate developers is that they are all less than twenty years old, profit(eer)ing from the Chinese State’s decision to discontinue public housing for middle class workers (For more details, see Historic Footnote, below).

Less than fifteen years after the end of public housing, the fact that four Shenzhen real estate developers are collaborating with Xiasha isn’t surprising. After all, the only remaining land to be developed in Shenzhen is under the control of Village Community Limited Corporations. Indeed, much of what is currently glossed as “renovation” is in fact, a process in which land rights transfer from the Village Holding Company to the Municipality by way of a developer, who sells buildings but not land. What is interesting, however, in how these developers are working with Xiasha to create a recognizably traditional and Confucian identity. In other words, Xiasha is being presented as a viable form of upgraded urban village that explicitly references tradition, rather than Communist history and the establishment of New China. Significantly, renovation at Xiasha not only marks the convergence of Village Community and Enterprise interests, but also reveals the ideological form of this convergence as an upscale urban village. What remains to be seen is whether or not Xiasha Limited can expand as the real estate companies have, or if it will remained tied to its traditional land.

Below, impressions caught on a walk from Chegongmiao to Xiasha. Several notes. 1. Chegongmiao was a mid-80s industrial park. It is now being renovated with restaurants and office space, but it does save the older urban layout as well as benefit housing stock. Thus, the area offers middle class workers relatively affordable and convenient housing. 2. Just across the street, Xiasha will soon boast a major KK skyscraper, which will make the urban village prime real estate. 3. I finished my walk by having my fortune told, by a Tianjin grandma, whose hand-written notebook reminds us that popular religion is not simply about respecting social hierarchy (as in the Chen-Yang Temple), but also manipulating fate to get ahead.

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Historic Footnote: The Privatization of Work Unit Housing and the Creation of Shenzhen’s Housing Market

Before the 1992 Southern Tour, housing in Shenzhen was typically of two kinds — either work unit housing, which was built by state work units for their staff or rental properties in the urban villages. Accordingly, state work units and independent crews were responsible for most housing design and construction. After the Southern Tour, however, Shenzhen began extensive housing reform (房改), which entailed both privatizing extant housing and creating commercial housing stocks. Until 1999, when the last work unit developments had been approved, Shenzhen had three kinds of housing — benefit housing (福利房), small profit housing (微利房), and commercial housing (商品房). Benefit housing belonged to the work unit, which assigned housing to staff by calculating such factors as seniority, tenure and hukou status. Small profit housing was just that, work unit housing whereby the unit building the housing was able to earn a small profit. Commercial housing was just that, housing that was developed with an eye to making a profit.

During the 1990s, most middle class Shenzhen residents lived in either benefit or small profit housing. In order to make their housing attractive to people who might otherwise settle for benefit or small profit housing, nascent real estate development groups sold life styles, the most popular of which was known as “European style”. Many middle class workers who already had a benefit or small profit home invested in commercial housing. However, most middle class workers aspired to either benefit or small profit housing. Nevertheless, housing reform transformed this system and by the end of the 90s and especially first years of the new millennium, commercial housing stocks had become the most common option for middle class migrants, who arrived in the city after benefit and small profit housing had been discontinued. For the next five years, work units allocated the last of benefit and small profit housing. Then, in mid 2007 – early 2008, Shenzhen’s real estate market took off, with housing and building prices abruptly doubling within one calendar year.