Developers go down market as China's anti-graft campaign bites

The developer behind an eight-storey clubhouse with a billion-dollar view over Shanghai's Huangpu River is turning to lower-end coffee shops and restaurants to fill the space, as a broad anti-graft campaign puts the brakes on conspicuous spending.

The state-of-the-art, steel and glass building was originally designed as a playground for China's elite, including space to mix and mingle with officials from state-owned enterprises based in offices nearby.

"Last year, we originally planned to open a clubhouse in the building, but it became too sensitive," said Vincent Zuo, a manager of research and development at Franshion Properties.

"We are now looking to open restaurants and coffee shops," said Zuo, adding that an art museum was another option for the arch-shaped building which sits in the middle of the company's 30 billion yuan (HK$37.2 billion) cruise terminal complex.

The decision to target middle-market consumers comes amid a crackdown on official corruption and extravagance that is forcing some high-end developers and hotel operators to change tactics to adapt to the new environment.

Shanghai Xintiandi, a commercial and residential complex owned by Hong Kong's Shui On Land which houses some of Shanghai's top restaurants, bars, shops and boutiques, has also adjusted its tenant mix.

"Our restaurants are now more targeted at white-collar workers" instead of elite big-spenders, said a manager in the complex.