For years, the Beijing Government has been trying to extend its business and financial centre from the east to the west. But the result has been far from fruitful. With the landmark building Beijing Capital Times Square due to be completed next month in Xicheng, the northwestern part of Beijing's urban area, mainland authorities hoped the area would draw investors' attention. Beijing Capital Times Square, developed by Wharf (Holdings), is a 1.29 million-square-foot office-retail-entertainment building in Xidan, one of the busiest shopping areas in Xicheng. Xu Yansheng, director of the district's Planning and Administration Commission, said Beijing Capital Times Square was the area's second-phase development and more planning was proposed. 'Xicheng is situated at a strategic location to Beijing, it has potential to be developed into a commercial and financial district,' said Mr Xu. Xicheng, which covers 31.66 square kilometres, borders on Dongcheng and other districts including Chaoyang, Haidian, Fengtai and Xuanwu. Beijing's central business district (CBD) at present is in the eastern districts of Dongcheng and Chaoyang. Xicheng is traditionally famous as a retail area for Beijing citizens and other mainlanders. Analysts said Xicheng should work 'very hard' if it wanted to be transformed into a new CBD. They said the development of Beijing's CBD historically relied on overseas investors who preferred the eastern part. Samantha Anderson, research and marketing manager of Colliers Jardine's Beijing office, said the districts were developing into a CBD because they had many A-grade office buildings such as China World Trade Centre, Oriental Plaza and Sun Dong An Plaza. The top-quality buildings were attracting multinational companies to open offices, she said. Many ambassadors had offices and homes in those districts, attracting foreign companies. But Ms Anderson said she did not expect Xicheng to become another CBD. Winnie Yip Wai-yi, general manager of C.Y. Leung & Co's Beijing office, said transportation problems and poor infrastructure made overseas companies hesitate. Zhang Qingshun, Western District's Foreign Economic Relations and Trade Commission director, said more than 500 companies had offices in the area. Foreign direct investment is valued at US$1.05 billion, $500 million of which came from property projects. Mr Xu said the government would build more underground car parks to improve the traffic situation. The Beijing Long-distance Telephone Bureau and China Telegram Building are in Xicheng, which would improve investment conditions in the area, said Mr Xu. He said the development of a long-planned 'Financial Street' in Xicheng would turn the area into a financial hub. However, analysts said development of the Financial Street had not been very successful. So far only one-third of it had been developed. Major financial institutions there are state-owned, including People's Bank of China headquarters, People's Insurance Co of China and the China Commercial and Industrial Bank. Ms Yip said Financial Street had failed to attract overseas investors partly due to China's restricted financial business policy for foreigners. She said the mainland's entry to the World Trade Organisation would open the fi nancial sector, which could help the area. Analysts believed that Xicheng's future would depend on Xidan, the district's centre. But they expected Xidan would become a more popular retail and entertainment centre for youths rather than a CBD. According to estimates by mainland authorities, 95 per cent of tourists in Xidan are mainlanders, of which 85 per cent were youngsters. The encouraging response to leasing retail space at Beijing Capital Times Square also reflected market demand, analysts said. Beijing Capital Times Square has a five-storey retail complex and includes a 1,000-seat cinema. About 60 per cent of retail space was leased to major tenants like Esprit Holdings. It also provides 600,000 sq ft of grade-A office space on 10 floors. About 20 per cent of the office space had been leased. The take-up rate was expected to rise to more than 30 per cent after the Lunar New Year. Ms Yip said Xicheng had the potential to develop into a mature business centre if it could attract more foreign investment. But she said that was unlikely to happen unless infrastructure facilities were drastically improved.