 The new capital Hangzhou grew into a major commercial and cultural center . It rose from a middling city of no special importance to one of the world 's largest and most prosperous . During his stay in Hangzhou in the Yuan dynasty ( 1260 – <unk> ) , when the city was not as wealthy as it had been under the Song , Marco Polo remarked that " this city is greater than any in the world " . Once retaking northern China became less plausible and Hangzhou grew into a significant trading city , the government buildings were extended and renovated to better <unk> its status as an imperial capital . The <unk> sized imperial palace was expanded in 1133 with new <unk> alleyways and in <unk> with an extension of the palace walls . 
