Big State-owned Banks Offer 180B Yuan in Financing for Development of Affordable Housing in Beijing

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Lenders in the Chinese capital of Beijing have agreed to provide around 180 billion yuan in financing to support the development of affordable welfare housing.

On the 22nd, the Beijing Affordable Housing Center Limited (北京保障房中心有限公司) signed strategic cooperative agreements with six banks, including Industrial and Commercial Bank of China (ICBC), China Development Bank (CDB), China Construction Bank (CCB), Agricultural Bank of China (ABC), Bank of China (BOC), and Bank of Communications (BOCOM).

Under the cooperative agreement, each of these banks will provide 30 billion yuan of financing support and IT development services to jointly support the development of affordable housing in Beijing.

Zhang Xiaoli (张晓丽), the Chief Accountant of the Beijing Affordable Housing Center, said that in addition to traditional financing, bonds, and investment, the strategic agreement with the six banks also covers internal fund management, optimization of financial allocation, improvement of operational efficiency, fintech and public REITs in a bid to leverage the advantages of each banking partner.

Jin Yan (金焱), Secretary of the Party Committee, Executive Director, and General Manager of the Beijing Affordable Housing Center, said that the centre “strives to increase the supply of public rental housing to meet the housing needs of special disadvantaged groups in the city, vigorously develop the market for rental housing, and increase welfare for new employment demographics such as new urban residents and young people.

“In the future, we will continue to focus on our main responsibilities in the field of housing security and contribute to the high-quality development of Beijing’s affordable housing by means of a financing system that employs multiple channels and forms of financing.”

As the largest developer of public rental housing and welfare rental housing in the Chinese capital, the Beijing Affordable Housing Center has backed nearly 180 affordable housing projects, with more than 160,000 units that are occupied by 86,000 households.

Huang Li (黄力), Secretary of the Party Committee and President of the Beijing Branch of ICBC, said the bank will use this opportunity to deepen cooperation, strengthen product innovation that combines equity and debt, and link investment and loans to the development of a financial service system exclusively for tenants.

“[We] will strengthen resource input, ensure exclusive quota limits and preferential prices for welfare rental housing, set up a welfare housing service team, and fully support people in the capital in achieving housing security.”

In recent years, China has accelerated the development of a housing welfare system comprised primarily of public rental housing, welfare rental housing, and co-owned housing, making use of the banking system to provide support to the development of the housing market.

The Beijing branch of ICBC has provided financing of 230 billion yuan to more than 150 policy-based housing projects in the national capital alone.