China unveils five-year urban renewal plan to revitalize idle properties

Beijing — China has released its first-ever dedicated five-year plan for urban renewal, marking a strategic pivot from decades of rapid city expansion toward revitalizing the nation’s vast stock of idle and underutilized properties. The plan, formally issued as State Council Document Guo Fa [2026] No. 12 on May 22 and published in detail by Xinhua News on July 2, sets ambitious targets for renovating aging infrastructure, converting vacant commercial and industrial spaces, and improving housing quality for millions of urban residents.

A historic policy shift

The “Urban Renewal 15th Five-Year Plan” (《城市更新”十五五”规划》) represents a fundamental change in China’s approach to urban development. For decades, the dominant model was “incremental expansion” — acquiring new land on city peripheries for large-scale construction as the urbanization rate surged from roughly 26% in 1990 to over 66% by 2025. But this model created significant inefficiencies: vacant factories in city centers, unsold housing inventory, aging infrastructure, and rigid land-use classifications that prevented adaptive reuse.

According to the Beijing News, which published the full text of the plan on May 28, the document outlines a comprehensive strategy to “comprehensively survey the bottom line of urban stock assets and resources” and promote the “classified disposal of already-supplied but undeveloped land and projects under construction.”

Ambitious infrastructure targets

The plan sets concrete quantitative goals for the 15th Five-Year period (2026–2030), including the renovation of approximately 200,000 kilometers of urban gas pipelines, 175,000 kilometers of drainage pipelines, 175,000 kilometers of water supply pipelines, 100,000 kilometers of sewage pipelines, and 120,000 kilometers of heating pipelines. It also targets the renovation of roughly 500,000 units of dilapidated housing, 115,000 old residential communities, and approximately 1,500 old neighborhoods and factory areas.

By 2030, the plan aims for “urban renewal actions to achieve significant progress” with initial results in transforming urban development and construction methods. By 2035, it envisions a more complete urban renewal system and the basic completion of “modern people’s cities” that are innovative, livable, beautiful, resilient, civilized, and smart.

Expert perspectives on the challenge

Li Yujia (李宇嘉), chief researcher at the Housing Policy Research Center of the Guangdong Provincial Urban and Rural Planning Institute, explained the historical context behind the policy shift. “In the past, during rapid urbanization and industrialization, there was strong demand for housing from all sectors and residents. ‘Land allocation and expansion’ was the main approach to urban development,” Li told Xinhua. He noted that residents now demand higher living standards and better supporting services for the elderly and children — amenities that older housing stock lacks.

Li also cautioned against potential pitfalls: “In the process of surveying and revitalizing stock resources, we must avoid applying a one-size-fits-all standard solution, avoid ‘government doing while people watch’ without engaging market entities and property owners, and most importantly avoid ‘changing for the sake of change’ that results in vanity projects.”

Breaking down institutional barriers

A major bottleneck identified by experts is the rigid separation of land-use categories — industrial, commercial, and residential — inherited from the rapid urbanization era. Qin Hong (秦虹), director of the Urban Renewal Research Center at Renmin University of China, noted that “the land management policy system formed during the rapid urbanization period does not match the complex and diverse renewal needs of the stock era.”

The plan addresses this by introducing a “positive list” (正面清单) for land mixed-use development and spatial composite utilization, alongside multi-department parallel approval and joint supervision. It also establishes a transition period policy allowing up to five years where land-use and planning conditions can remain unchanged while developing state-supported industries, after which land-use rights can be obtained through leasing or negotiated transfer rather than competitive bidding.

Financing the transformation

Vice Minister of Housing and Urban-Rural Development Qin Haixiang (秦海翔) outlined the financing framework, calling on localities to “make good use of central government fiscal funds, local government special bonds, and credit funds, fully leverage market mechanisms, actively attract social capital participation, and encourage private enterprises to participate in urban infrastructure construction and operation.” The plan also allows for infrastructure REITs, asset securitization, and corporate bonds as financing tools.

Converting assets into opportunities

Yun Shuang (恽爽), president of Tsinghua Tongheng Urban Planning and Design Institute, highlighted the economic potential of renewal projects. “These idle and inefficient factories and old neighborhoods have high asset value. Through renewal, transforming them from ‘inefficient assets’ into ‘operable assets’ can generate sustained rental income, consumption, employment, and public service benefits.”

Under the plan, unsold commercial housing can be converted into subsidized rental housing, resettlement housing, talent housing, or worker dormitories. Old factory districts can be redeveloped for new commercial and cultural uses, while idle public housing can be repurposed for community services.

A national data infrastructure

Xie Haixia (谢海霞), director of the Territorial Space Planning Bureau at the Ministry of Natural Resources, described plans for a unified “one map” (一张图) system integrating natural resource management and territorial spatial planning data. “We will strengthen the investigation of stock resources, clarify the baseline, conduct full lifecycle management on the ‘one map,’ break through departmental data silos, effectively manage assets, put resources to use, and revitalize cities,” she said.

Broader economic context

The urban renewal plan comes amid a prolonged downturn in China’s real estate market, with declining housing prices and developer debt crises. It aligns with the government’s broader strategy of “de-stocking” (去库存) measures and a strategic pivot toward “new quality productive forces” (新质生产力) and high-quality development. The plan signals that China’s urban future lies not in building more, but in making better use of what already exists.

What to watch

Key questions remain about implementation capacity, financing sustainability given local government debt constraints, and whether converted properties will meet actual market demand. The plan’s success will depend on coordination between central and local authorities and the ability to avoid the “vanity projects” warned against by experts. With the first-ever national urban renewal blueprint now in place, China’s cities are entering a new era — one defined not by expansion, but by renewal.