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La Métropole du Grand Paris: a redistricted Paris seeks to attract foreign investors
The reorganized Grand Paris plan will divide the Paris region into new zones. Real estate professionals are using the redistricting to attract foreign investment in lesser-known neighborhoods of the capital.
An initiative launched by former French President Nicolas Sarkozy, the Métropole du Grand Paris, or Metropolis of Greater Paris, is a reorganization of the Paris metropolitan region into 12 distinct “territories.”
The new metropolis will mainly comprise of Paris and the three inner suburbs: Hauts-de-Seine, Seine-Saint-Denis and Val-de-Marne, covering 762 square kilometers and containing 6.7 million inhabitants. As such, the project will bring together 124 municipalities, including a number of others in the outer suburbs such as Agenteuil and Savigny-sur-Orge which may also be integrated, with a demographic threshold of 300,000 inhabitants per territory.
The redistricted capital will also receive an upgraded transport plan in order to better connect outer districts to central Paris and to each other.
The expansion of Paris’ transport system will be carried out over ten years, costing the state and local governments 35 billion euros. Its main feature will consist of a driverless figure-eight-shaped metro line serving areas such as Versailles and the two airports: Orly and Roissy-Charles de Gaulle. The plan is to build it in three phases: in 2018, 2025 and after 2025.
Alongside this, existing metro lines, such as line 11 and 14 — along with regional and suburban tracks — will be extended and re-equipped.
Established in order to reduce inequalities between regions, enhance the appeal of certain areas and improve the quality of life of its residents, the Grand Paris has been regarded as the Parisian equivalent of Greater London.
The implementation of the project is scheduled for January 1st 2016, but several of its defining characteristics such as new housing policies will become effective only a year later, on January 1st 2017. These include new financial aid for disadvantaged lodgers searching for accommodation, actions in favor of social housing, the rehabilitation of inadequate lodgings, as well as a significant increase in the built housing stock. Indeed, one of Sarkozy’s main aims for the project was the construction of 70,000 new homes per year — against 38,000 new homes actually — in the redefined region.
Real estate consultant group Jones Lang Lasalle has published detailed prospective studies of Grand Paris areas, in order to attract long-term foreign investors. JLL aims to “explain” to international buyers what the new metropolis can offer, by calculating the consequences Paris’ new and improved transport network will have on real estate.
This prospective approach aims to inform interested parties on what to expect in terms of property value 5, 10 and even 15 years down the line.
Areas JLL has focused on include northeastern Paris, Clichy-Batignolles and the St Ouen docks. JLL expert Virginie Houzé dubs the extended metro line 14 the “backbone of tomorrow’s Paris.” Houzé explains that while the St Denis area, served by line 14, is worth 300 to 320 euros per square meter today, it is expected to jump to 400 euros per m2 in just a few years — potentially by 2019 when the line 14 extension is completed.
The JLL analysis takes into consideration criteria such as the development of transport systems in the area, its demographic, property offer and whether the area in question has the capacity to accommodate residents, businesses and services.
One foreign entity in particular, the Chinese sovereign wealth fund China Investment Corporation (CIC), has already disclosed its plan to invest up to a billion euros — in partnership with the French Deposits and Consignments Fund — in Grand Paris’ property and infrastructure developments.
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