Industrial Insight

Skyscrapers…. | July 30, 2013

http://www.bloomberg.com/news/2013-07-29/china-is-set-to-suffer-the-skyscraper-curse.html

China Is Set to Suffer the Skyscraper Curse

By William Pesek Jul 29, 2013 4:00 PM CT

Yet the experiences of Japan, Malaysia, the United Arab Emirates and the U.S. show an uncanny correlation between architectural one-upmanship and economic doom. In the 1920s, for example, New York’s Chrysler and Empire State buildings opened amid the Great Depression. Later, New York’s World Trade Center and Chicago’s Sears Tower presaged fiscal crises and the breakdown of the Bretton Woods system.

In the late 1990s, Kuala Lumpur’s Petronas Towers opened at the height of the Asian crisis. A decade later, Dubai’s economy hit a wall right on cue as the 828-meter Burj Khalifa was getting its Guinness World Records mention.

Skyscrapers are akin to giant punctuation marks made of steel, glass and concrete, screaming, “Check us out!” More than technological progress, they usually reflect hubris. Exaggerated pride and easy credit — terrible bedfellows in the best of times — fuel irrational growth and valuations; they drive developing nations toward overreach. This is precisely where China finds itself in 2013 as the economy’s excesses spark fears about financial turmoil, debt defaults and social instability. China will have to be very lucky to avoid the skyscraper curse.

The Changsha project is a particularly interesting metaphor for China’s economy. The blistering pace at which the building will go up — more than two stories a day — raises serious concerns. Broad Group’s claim to fame is prefabricated steel and concrete modules that supposedly make construction cheaper and more ecologically friendly. Last year, it put up a 30-story hotel in just 15 days. Yet how well can a 202-story building that is essentially a giant Lego set withstand earthquakes, extreme wind or fire?

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