Institutional Mechanisms of Financing Transport Infrastructure in China — Comparative Lessons from the “Rail Plus Property” Model in Shenzhen and Nanjing
Congcong Li ( Université Paris 1 Panthéon-Sorbonne / Géographie-cités) will defend her doctoral dissertation entitled “Institutional Mechanisms of Financing Transport Infrastructure in China — Comparative Lessons from the “Rail Plus Property” Model in Shenzhen and Nanjing, under the supervision of Natacha Aveline-Dubach, on
December 15, 2025
9:00 a.m.
Salle Duroselle
Université Paris 1 Panthéon-Sorbonne
Jury
- Natacha Aveline-Dubach, CNRS Research Director in Urban Geography, UMR Géographie-cités, Supervisor
- Jean Debrie, Professor of Urban and Regional Planning, Université Paris 1 Panthéon-Sorbonne, Chair
- Sonia Guelton, Professor Emerita of Urban Planning and Development, Université Gustave Eiffel, Reviewer
- Qiulin Ke, Associate Professor, The Bartlett School of Planning, University College London, Examiner
- Alexander Lord, Professor, Department of Geography and Planning, University of Liverpool, Reviewer
- Philippe Poinsot, Senior Lecturer in Transport and Urban Economics, Ville Mobilité Transport Laboratory, Université Gustave Eiffel, Examiner
Abstract
Metropolitan governments are facing increasing difficulties in financing their public transportation systems, which are considered an essential pillar of sustainable development. The principle of co-financing these costly infrastructures with income generated by real estate developments located along the metro lines—an approach known as development-based land value capture—has gradually gained ground, driven by active promotion by multilateral organizations such as the World Bank and the OECD.
A key challenge of this approach lies in understanding how the land value created by mass transit investments can be effectively captured and equitably allocated through institutional arrangements. China serves as a vivid laboratory for investigating the mechanisms and urban implications of this development-based value capture approach. China’s strategy for LVC combines scale-driven transit infrastructure investment with institutional experimentation in transport financing. This dynamic has been exemplified by the “metro boom” that followed the launch of an ambitious infrastructure-focused stimulus package in the aftermath of the 2008 global financial crisis. Local governments continued their strategy of extracting urban rent to finance urbanization—historically based on the transfer of public land use rights and off-budget borrowing—by directing property development along metro networks. In order to contain the debt risks associated with the cost of metro growth and urbanization, they then experimented with the ‘Rail + Property’ (R+P) model, inspired by the practice of the Hong Kong MTRC company. The pioneering implementation of this model in China by the Shenzhen Metro Company has been hailed as a paradigm case, with the latter having earned the reputation of the “sole profitable transit company in mainland China without subsidies”.
The thesis shifts from the depoliticized, functionalist readings in the prevailing narrative to a critical interrogation of the role and effects of institutional configurations. It argues that the Shenzhen model is neither sustainable nor replicable, as its past performance depended on two exceptional conditions: a favorable real estate cycle and unique institutional concessions granted by the central government. Drawing on a diverse methodological approach—including interviews with 253 relevant stakeholders, documentary analysis, field observations, and a six-month internship with the Shenzhen Urban Transport Planning Center Co., Ltd. — this thesis compares Shenzhen’s paradigmatic case with that of Nanjing, a regional capital shaped by governance and spatial configurations typical of China’s city regions. It demonstrates how the distinct dynamics of the two local political economies have produced divergent approaches to value capture: Shenzhen’s expansionary model prioritizes short-term profit and rapid scale-up while downplaying risk management, whereas Nanjing’s more conservative model, constrained by institutional structures, is marked by incremental and reactive adjustments.
The findings suggest that while LVC instruments offer valuable potential as a funding source for public transit, their long-term viability depends on early institutional embedding that aligns spatial, fiscal, and political interests, alongside well-developed project planning and capacity support in real estate expertise. This research also shows that the principles of LVC and Transit Oriented Development (TOD) are not necessarily convergent in the Chinese case, but depend on political choices and orientations driven by local governance structures. In the end, while China’s experiments with the “R+P” model have produced effects in terms of co-financing urban infrastructure, they have yet to establish a stable foundation for a structural shift in the national framework. Future reforms need to move beyond the expansion-oriented political–fiscal architecture to address the growing complexity of mature urban contexts.
The Eye of Shenzhen” — Gangxia North Station as a Symbol of Transit-Led Urban Ambition
(Source: Li Congcong, fieldwork photograph, 2025)
