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Journal of Chinese
Architecture and Urbanism The role of planning

officials and political leaders. It is not surprising that in the inner city, which is easier to lease for profitable
state enterprises, occupying land in inner Shanghai — use compared with land in less favorable locations. In
where land value has significantly multiplied in the past addition, the size of the land plot also plays a role in land
decades and is expected to continue increasing — are profitability. A small piece of land is less profitable for
often reluctant to relinquish their land rights. As long as leasing compared to a large-sized land plot. For instance,
the state enterprise does not agree to relinquish its land the Shanghai Medicine Group, which controlled 54 small,
rights, the implementation of the land use plan has to be distributed pieces of industrial land, intended to acquire a
suspended. Unless significant public interests are involved, large piece of land in Shanghai’s satellite towns to relocate
such as public infrastructure or projects with national or their factory in exchange for the 54 inner-city industrial
municipal significance (Ren, 2014), state enterprises tend land pieces. However, the government did not favor this
to hold onto the land for their own uses. plan as the small, distributed pieces of land were not

The dilemma of land acquisition has been taken into profitable enough to lease (Interview in October 2019).
consideration by the local government when making Studies on redevelopment projects in Shenzhen have also
a plan. A land use plan needs to balance the proportion shown that urban sites with high land rent gap levels and
of various land uses, such as commercial and non- low transaction costs are more likely to be redeveloped
commercial land use, to obtain approval from the upper earlier (Lai et al., 2021). This implies that the local
government. The local government tends to use the land government is selective in choosing parcels of industrial
it occupies to plan for projects that generate land revenue. land for redevelopment while leaving others suspended or
Meanwhile, land occupied by state enterprises is planned awaiting future opportunities.
for non-commercial purposes. This approach ensures that However, for the industrial land that is not yet in the
the proportion between commercial and non-commercial forthcoming implementation agenda, there is a market-
land use is balanced and aligns with planning guidelines. driven, bottom-up motivation for redevelopment. On
For instance, in Baoshan District, Shanghai, land occupied the land supply side, original manufacturing production
by state enterprises — which is less likely to be retrieved activities have been terminated or reduced, leaving
by the local government for profitable uses — is largely industrial buildings idle and providing potential space
planned for non-commercial uses such as green open for new uses. On the land demand side, potential tenants
space (Xia, 2017, p. 209). require more space for emerging businesses. The situation
sets the stage for an alternative form of redevelopment
Due to the various ownerships of industrial land, land
transactions have become challenging for implementing the beyond the planning-led approach.
land redevelopment plan. Furthermore, even for industrial 5.2. The underpinning rationales of legitimating the
land occupied by the local government, redevelopment practice-led approach
activities may stagnate despite the approval of plans. The
government will need to take steps to implement the plan The afore-described practice-led industrial redevelopment
in a top-down approach. The latest Shanghai Master Plan approach emerged and gained support from the local
was developed in 2015 and approved in 2018, serving as government for multiple reasons. It can be seen as
the future scheme of urban development in 2035. However, a consequence of interactions among different local
this does not mean that all the land will be transformed authorities and agencies within the specific institutional
from its current use to the planned use all at once. The environment.
implementation of the plan is a long-term process, with First, the current planning system does not provide
some urban sites redeveloped earlier than others. The adequate solutions for industrial land retrieval, leading
decision on which sites to implement first is subject to to land redevelopment being suspended for extended
internal and external social and economic circumstances, periods. In response to this issue, the introduction of
such as location factors, land property rights, and land use the “three unchanged” policy indicates that the local
status. government prioritizes immediate social and economic
One of the main driving forces for the local government interests over strict development control legitimacy. The
to promote land redevelopment is to obtain the “land rent planning authority compromises by accepting that, as long
gap.” It is highly profitable for the local government as the as the formal or registered land use of the land does not
subsequent land transfer fee through land leasing is much violate the existing zoning plans, it would remain silent on
higher than the previous land compensation, contributing the proposed adaptive reuse of industrial sites.
significantly to the local budget. Driven by the concept of Second, industrial land reuse projects still require
the “land rent gap,” the government tends to favor land permission from the local government. In the absence

Volume 5 Issue 4 (2023) 10 https://doi.org/10.36922/jcau.0433