THE increasing competition in Shanghai's retail market has not deterred Pudong Development Holdings from investing in a four-storey shopping centre in the Pudong New Area. Together with one of the four government-appointed real estate developers of Pudong, Shanghai Lujiazui Finance and Trade Zone Development Co, the company will build the centre to cater to the middle to high-end market in the Zhuyuan Commerce and Trade Area of the Lujiazui zone. The deputy general manager of Pudong Development, William Wu Choi-sun, said total investment was US$25 million. He said the company holds 60 per cent of the deal which was signed last month. The shopping centre will be built on a 279,864 square foot site and the total gross floor area will be 753,480 sq ft. The four-storey structure can house 700 shops, two levels of underground parking and food stalls. Shanghai reported a 28 per cent jump to 7.65 billion yuan (about HK$6.86 billion) in retail sales in April, boosted by the onset of a five-day work week. Retailers complain they face increasing competition as more and more foreign investors flock to the fast-growing market. Mr Wu said the company was taking a medium-term view of the investment. 'Competition is always a problem,' he said. 'We are going in simply as a developer and we are looking at it as a 24 to 30 months thing,' he said. The company hoped that by then the austerity drive in the mainland would be over. 'With the austerity drive, there is no hot money and hence less desire to spend. But we are banking on the medium and long term,' he said. Mr Wu was confident about the project because there were no other shopping malls in the area, only office buildings. Construction would start next year and should be completed in 21/2 to three years. Japanese retail giant Yaohan will launch its Nextage Shanghai department store in December. In Puxi area, many retail chains have established stores. They include Isetan, Printemps from France and Hong Kong retailers such as Dickson Concept, which targets the high end of the market, and garment retailer Theme.