Chinese property market still attractive to foreign investors
Chinanews, Beijing, Oct. 12 ¨C Foreign investment activities in Chinese property market reached a climax during the first half of this year. According to Daily Economic News, a report titled “Globalization Leads to Investment Boom” and released by Jones Lang LaSalle, a world real estate services and money management firm, shows that as a burgeoning market, China remains attractive to foreign investors. During the first half of this year, direct investment in Chinese real estate market reached 4.75 billion US dollars, doubling the figure of the corresponding period of last year. The first-tier cities such as Beijing and Shanghai have become foreign businesspeople¡¯s most favorable places for making investments.
Global funds management companies have placed a large amount of their money into the Shanghai property market. By September 2006, 15 buildings had been entirely sold to one company. Transaction volume of these buildings reached 1.8 billion US dollars, most of the buyers being foreign investing companies based in the United States, Europe and the Asia-Pacific region. Among these 15 buildings, seven are luxury hotel-style apartments or high-class residential houses later renovated into hotel-style apartments. Insiders say the best time has come for investors to buy luxury hotel-style apartments located in a good place in Shanghai, and their rents are climbing steadily.
Senior manager in Jones Lang LaSalle’s China office Deng Wenjie predicted that multinational companies would continue to expand their business in China. As China further opens its finance sector, more A-class offices will be in demand. As the number of foreign staff workers increases in China, it will stimulate the demand for luxury hotels and hotel-style apartments. Meanwhile, people¡¯s increasing disposable income and the ever-expanding middle class group will benefit domestic shopping malls greatly. As the market becomes more transparent, it will attract more foreign investment.
He also predicted that during the latter half of this year, more transaction deals would be clinched in China. Foreign investors who have a clear investment plan will further increase their investment in China. As competition becomes fierce in the first-tier cities, investors will shift to the second-tier cities to seek for gains.