China real estate is confronting a land-tenure issue involving more than 1 trillion yuan, or about $148 billion, of non-residential property with 20 years or less remaining on underlying land-use terms. The issue matters to owners, buyers and lenders because shorter tenure can affect valuations, refinancing and commercial property deals.
Key Takeaways
- Cushman & Wakefield estimates that more than 1 trillion yuan, or about $148 billion, of non-residential property in China has 20 years or less remaining on its land-use terms.
- CBRE estimates that about 30 million square meters of single-owner office and retail space across 18 major Chinese cities will have less than 20 years of tenure remaining by 2030.
- Recent reporting says Shanghai circulated renewal guidelines after Guangzhou took a similar step earlier in 2026.
- China’s average office vacancy rate reached 24.7% in the fourth quarter of 2025, while average office rents fell 10.4% for the full year, according to CBRE.
The China real estate market is facing a more visible commercial-property issue as buildings granted land-use rights decades ago move deeper into their original terms. Unlike a tenant lease, the concern centers on the land-use right beneath an office tower, shopping center or warehouse. The remaining term stays with the property when ownership changes.
Cushman & Wakefield says urban land-use terms have typically been set at 40 years for commercial property, 50 years for office and industrial uses and 70 years for residential property. For non-residential assets, renewal details have historically varied by location, creating uncertainty around timing, fees and procedures.
Andrew Chan, head of valuation and advisory services for Greater China at Cushman & Wakefield, estimates that more than 1 trillion yuan of non-residential property now has 20 years or less remaining. CBRE separately estimates that about 30 million square meters of single-owner office and retail space in 18 major cities will fall below that threshold by 2030.
CBRE has said buyers and sellers treat remaining tenure as a pricing variable, with shorter terms generally having a greater negative effect on value. That puts tenure alongside rent, occupancy, location and financing costs in the broader commercial property valuation process.
Song Hongwei, research director at Tospur Real Estate Consulting, said: “Policy uncertainty over leasehold renewal has tanked appraisal values of commercial properties, hurt fundraising and impeded deals.”
Chan also said many banks are reluctant to extend or refinance loans on properties with less than a decade left on their land-use terms. That can narrow financing options well before formal expiry.
Office Weakness Raises Pressure on Older Assets
The tenure question is emerging while China’s office market remains under pressure from high vacancy and lower rents. CBRE reported national office vacancy of 24.7% in the fourth quarter of 2025. Average office rents fell 2.4% from the previous quarter and 10.4% across the full year.
Full-year office net absorption still rose 12% to 2.15 million square meters, but new supply reached 4.43 million square meters, up 20% from a year earlier. Leasing activity improved, but substantial new space continued to enter the market.
For older buildings, a shorter remaining land term adds another factor when buyers and lenders assess value and refinancing options. Similar asset-level factors appear across the broader office REIT market, where occupancy, lease renewals, financing costs and property values remain central measures. China’s land system is different, but the comparison shows why lease duration and asset quality matter in commercial-property analysis.
Renewal Guidance Could Reduce a Major Valuation Variable
Reporting published in August 2026 said Shanghai officials circulated guidelines outlining terms and costs for land-use extensions after Guangzhou took a similar step earlier in the year. The developments have drawn attention because more specific renewal procedures could narrow the assumptions used in appraisals.
Cushman & Wakefield noted in a 2025 analysis that automatic renewal applies to residential land-use rights, while non-residential terms do not have the same detailed arrangement. The firm said local approaches can vary, contributing to differences in how renewal risk is reflected in asset values.
That makes commercial property valuation especially relevant for aging assets. Current income remains important, but buyers and appraisers also examine lease terms, financing conditions, property condition and other factors that can affect future value.
The $148 billion estimate does not mean the affected properties are about to expire or become unusable. It identifies a large group of non-residential assets that have entered a shorter-tenure period, where renewal terms can carry more weight in pricing, lending and transaction decisions.
For China real estate, the near-term issue is therefore one of clarity and valuation rather than a single expiration event. As more properties move toward shorter remaining terms, owners, buyers, lenders and appraisers are likely to pay closer attention to the land-use right beneath each asset.
Frequently Asked Questions
What Does the $148 Billion Figure Represent?
It is Cushman & Wakefield’s estimate of non-residential property in China with 20 years or less remaining on its land-use terms. It does not mean those properties are currently expiring.
Why Do Land-Use Terms Matter for China Real Estate?
China real estate assets sit on land-use rights granted for fixed periods. Shorter remaining terms can influence valuation, refinancing and buyer assumptions.
How Much Office and Retail Space Could Have Shorter Tenure by 2030?
CBRE estimates that about 30 million square meters of single-owner office and retail space across 18 major Chinese cities will have less than 20 years remaining by 2030. The estimate does not cover every commercial property in those markets.
What Changed in Shanghai and Guangzhou in 2026?
Recent reporting says Shanghai circulated renewal guidelines after Guangzhou took a similar step earlier in 2026. The guidelines address terms and costs for land-use extensions.
