Mainland developer tests island market
Closer economic co-operation between the mainland and Taiwan has prompted mainland developer Vantone Real Estate to test mainland interest in island real estate.
The Beijing-based developer auctioned, off plan, a unit at its Taipei development, Vantone Taipei 2011, to a Shanghai buyer for 5.81 million yuan (HK$7.09 million), or 40,000 yuan per square metre.
'This is a marketing gimmick to raise the public interest in the development,' an executive of Vantone's marketing division said.
Vantone, through its affiliate in Singapore, Vantone Capital, is to build the development on a site of 3,305 square metres in Danshui, New Taipei city.
The project will comprise three 29-storey towers - two residential and one office building. Construction will start this year and the first completed units are scheduled to be delivered to clients by 2014.
The 276 flats are expected to sell for between 5 million and 10 million yuan, or an average price of 40,000 yuan per square metre, the marketing executive said.
The developer plans to launch the property in Beijing, Shanghai and Xiamen, and if the response is good a plan to sell units overseas will be scrapped.
Hundreds of potential mainland buyers had shown interest in the project, the executive said, and a growing number of mainlanders were purchasing homes in Taiwan.
Beijing, Shanghai and Xiamen residents are allowed to visit Taiwan under an individual-travel scheme that began on June 28. Measures issued by Beijing to cool home prices in mainland cities have also pushed wealthy buyers to look to offshore property markets, with Taiwan an option, the executive said.
Taiwan offers permanent ownership of land, while on the mainland residential land is leased from the government for up to 70 years.
However, Alan Chiang Sheung-lai, head of residential, Greater China at DTZ, said it was still too early to say if a trend for mainlanders to buy Taiwan property was gathering pace. At present, mainlanders wishing to buy in Taiwan must qualify by investing in enterprises on the island.
'It will also be very difficult for mainland developers to enter the market, as the big local players have basically dominated it. After all, the market scale is very small,' Chiang said.
Despite the challenges, however, mainland developers have shown interest, with many heading to the island in 2007 and early 2008.
In 2007, China Vanke chairman Wang Shi and Vantone chairman Feng Lun led more than 20 companies to study investment in Taiwan.
In February 2008, nine mainland property tycoons visited Taiwan, including the mainland's wealthiest man, Yeung Kwok-keung. Among the others were Li Silian, Chu Man Yee and Pan Shiyi. They visited Taipei, Taichung, Kenting and Aoti to check opportunities for investing in leisure and tourism facilities.
The number of months per year mainland visitors can spend in Taiwan under recently revised regulations