AI industry drives the transformation of industrial zones, Anxin Construction: Landowners can start reconstruction by preparing 20-30% of their own funds

Driven by the rapid development of AI and high-tech industries, traditional industrial areas are facing transformation.

The AI ​​industry has driven the demand for enterprise expansion and industrial space upgrades. However, as banks have become more cautious in granting credit and construction costs remain high, many industrial zone landlords have land, but are unable to promote reconstruction due to a lack of construction funds. Anxin Construction pointed out that if the landowner can prepare about 20% to 30% of the total development cost with its own funds, combined with full project management and construction financing, there is still a chance to promote reconstruction while retaining land property rights.

Anxin Construction said that asset revitalization of industrial zones involves financing, planning and design, construction contracting and project management. If the landowner has reconstruction needs, he can integrate relevant resources through full case management and cooperate with financial institutions to plan and construct financing, from early land condition inventory and financial calculation to subsequent project execution and fund control, to reduce capital and engineering risks in the reconstruction process.

Regarding the self-owned funds and financing ratio that landowners are most concerned about, Lin Yiwei, associate president of China Trust Bank, said that the financing conditions of each case are different, and the bank will make a comprehensive evaluation based on the land value, project budget, landowner's financial ability and the source of repayment after completion. If a professional full-case management team assists in proposing a specific development or construction plan, and cooperates with a financial institution familiar with industrial zone financing, if the existing bank financing ratio is not high, a preliminary trial calculation can be made with self-owned funds accounting for 20% to 30% of the total development cost and construction financing accounting for 70% to 80% of the approved project cost.

Based on an estimated total development cost of NT$500 million, the landowner may need to prepare about NT$100 million to NT$150 million of its own funds, while the remaining NT$350 million to NT$400 million will need to be planned for financing depending on the conditions of the case. However, the actual financing amount must still be reviewed by the financial institution on a case-by-case basis based on factors such as land value, project content, borrower conditions, and repayment sources.

Zhang Fengrong, general manager of Anxin Construction, said that judging from practical experience, many landowners do not have no desire to rebuild, but they do not know where to start as the first step, and are also worried about budget additions, project delays, and inability to connect funds. For example, if the total construction cost reaches NT$500 million and the project budget is increased by 5%, the expenditure may increase by NT$25 million, which is a considerable burden for the landowner.

Zhang Fengrong pointed out that the overall project management mainly assists the landowner in taking stock of costs, controlling funds and project risks in the early stage. Construction financing is usually allocated in stages according to the progress of the project, and is combined with a special trust account, project review and financial audit, so that the funds can be used according to the progress of the project, reducing risks such as fund disconnection, budget loss and project suspension; at the same time, the landowner can still retain land property rights and major decision-making rights.

Judging from actual cases, a landowner family holds about 600 square meters of industrial land, and the factory building is over 40 years old. Although there is a desire to rebuild, the biggest problem is the lack of construction funds. Zhang Fengrong said, "Having land but no money does not mean that rebuilding is impossible." The landowner can first take stock of the land conditions, the scale of construction, product positioning and future income, and then plan financing channels and repayment sources based on their own financial capabilities.

Zhang Fengrong further pointed out that if partial sales or pre-sales are adopted in the future, the relevant income can also be included in the overall plan for repaying financing and supporting project funds. Therefore, for industrial zone landowners, it is necessary to conduct an asset inventory and financial trial calculation before reconstruction, which will help confirm the funding gap and subsequent repayment ability, and then decide on a suitable development model.