Foreign funds return to China real estate market
Of the 17b yuan worth of mega deals in Shanghai in the first half, foreign acquisitions account for 81pc, three times the level for the whole of 2012
Foreign capital is returning to the mainland's real estate investment market, with major deals in Shanghai helping to drive the number of transactions in the first half of the year to three times the level for the whole of 2012.
"There is more to come, at an even faster pace," said Stanley Ching, senior managing director and head of the real estate group at Citic Capital, a private equity firm.
Transactions valued at US$10 million or above that were completed in Shanghai in the first six months of the year amounted to 17 billion yuan (HK$21.4 billion) and foreign acquisitions accounted for 13.8 billion yuan, or 81 per cent, according to a study by international property consultancy DTZ.
By comparison, foreign firms were responsible for 4.58 billion yuan of deals in 2012, or about 14 per cent of the total transaction value of 33 billion yuan for the year.
In June this year, Citic Capital closed a US$683 million property fund that will focus on acquiring retail properties on the mainland, with investors coming from the United States, Europe, the Middle East and Asia. Hong Kong-based Gaw Capital Partners is also in the final stages of closing a US$1 billion fund that will target properties mainly in first-tier cities.