Tools: Save | Print | E-mail | Most Read
Property Curbs Yet to Have Impact
Adjust font size:

The central government's curbs on foreign investment in the real estate sector have yet to dampen institutional investors' ardor for purchasing properties in Shanghai, according to industry experts.


Singapore-based Ascendas, a leading business space provider in Asia, has already signed a contract to purchase Ocean Towers, a high-end office block in downtown Shanghai, at a price ranging from 160 million yuan (US$20.3 million) to 180 million yuan (US$22.8 million), according to top real estate firm Jones Lang LaSalle.


"Though several negotiations were on hold as overseas institutional investors reworked their investment strategies, on the whole, foreign institutional players remain greatly interested in participating in China's economic growth as long-term property investors," said Kenny Ho, associate director of the research department at Jones Lang LaSalle's Shanghai office.


As the latest report from Jones Lang LaSalle indicates, at least 16 properties, mainly offices and residential buildings, have been snapped up by foreign investors in the first three quarters of this year, with the total trading price estimated to exceed 8 billion yuan (US$1 billion).


Ho said he was confident that there would be 20 such deals this year double last year's figure.


Most of the buyers are powerful international investors such as Morgan Stanley and Citigroup. Morgan Stanley and associates have reportedly acquired East Ocean Plaza from Zhejiang Greentown Group, a domestic property developer, for 245 million yuan (US$31 million).


Meanwhile, Citigroup Property Investor entered into a joint-venture redevelopment of historical homes in the lanes of Jianyeli in downtown Shanghai, while a separate division of Citigroup paid 65 million yuan (US$8.2 million) to acquire a 38,000 square-meter office portion of the Daning Life Hub project


Unlike last year, foreign institutional investors are purchasing properties other than offices and high-end residential buildings. "That's mainly because the price of offices and residential buildings is extremely high in Shanghai, so investment in these two types of properties can bring fewer returns than before," said Terence Tang, an investment expert at Jones Lang LaSalle.


Office rents have risen dramatically in Shanghai, with office space now at a premium in the city.


Although it has yet to be completed, all available office space at Plaza 66, a high-end development on West Nanjing Road, has been snapped up.


Daily rents are expected to reach US$1.4 to US$1.6 per square meter.


Demand for luxury residential apartments remains strong, as seen by the robust sales of a number of new projects in the third quarter. Jing'an Four Seasons sold out all 192 available units within one month, at an average price of over 30,000 yuan (US$3,797) per square meter. Meanwhile, Lakeville Regency sold another 70 units in the third quarter, at an average price of 53,000 yuan (US$6,709) per square meter.


(China Daily October 24, 2006)


Tools: Save | Print | E-mail | Most Read

Related Stories
Foreigners May Face Curbs in Second-hand Housing Market
Housing Prices Keep Rising, But More Slowly
Policy Impacts on Property Sector
Steps Taken to Cool Property Market
First Local Gov't White Paper Issued in Shanghai
New Rules for Foreign House Sales

Product Directory
China Search
Country Search
Hot Buys
SiteMap | About Us | RSS | Newsletter | Feedback
Copyright © All Rights Reserved     E-mail: Tel: 86-10-88828000 京ICP证 040089号