Qingdao, a coastal city in Shandong province, has emerged as a new target for Hong Kong developers as they increasingly shift their attention towards second-tier cities given the surging land prices and lack of urban sites in first-tier cities. Hutchison Whampoa, Kerry Properties, Hong Kong Construction and Shui On Group had already built up a presence in the city, said Joe Zou, general manager of property adviser DTZ's Qingdao office. They first entered the city in 2005, two years after property prices began picking up, Mr Zou said. Compared with other cities, Qingdao has yet to find great popularity with Hong Kong developers. However, he expected more foreign players to target the city after looking at its growing economy. Qingdao and other cities near the Bohai Sea aim to develop the region as the mainland's third-biggest economic powerhouse, after the Pearl and Yangtze river deltas. The region also consists of Beijing, Tianjin in Hebei province and Dalian in Liaoning province. The gross domestic product of Qingdao, a municipality that covers seven districts with 2.5 million people, grew 15 per cent last year. Property prices have been rising since 2003, with average home prices of 4,225 yuan per square metre last year, up 17.23 per cent from 2005. But prices of luxury flats with sea views were being sold at more than 30,000 yuan per square metre, Mr Zou said. Most of the buyers were from nearby cities, he said.
