Guangzhou-based developer Chang Sheng (China) Group plans to raise up to US$200 million in an initial public offering next month, signalling continuing optimism in the sector despite a government crackdown on property speculation. Cazenove Asia is the sole sponsor of the offering and will be joint bookrunner with BOC International. Two mainland investment banks, China International Capital Corp and Guotai Junan (Hong Kong), are also helping with the share sale. 'The offering could have been launched at the end of last year but the management decided to wait for the addition of two new sites to the listed vehicle,' said a market source. The deal would come to the market before the Lunar New Year. Ahead of the offering, investment bank Goldman Sachs has acquired a 20 per cent stake in the firm to become its second-largest shareholder. Chang Sheng is mainly involved in commercial building development but also has residential projects. It plans to add more sites to its land bank, using the offering proceeds for high-end projects in prime cities including Beijing. The deal would be the first property initial public offering since October last year when the mainland government imposed several tightening measures in order to crack down on speculation in the property market. Felix Man Kam-fai, a director of Hantec Futures, said the central government was set to launch more stringent controls to prevent overheating in the property market and this would bring more uncertainty to the market. 'How it prices the shares to make the company attractive to investors will be very important for Chang Sheng,' Mr Man said. Beijing raised interest rates six times last year to keep the mainland property market from overheating. The government has also lifted mortgage requirements for investment properties. Speculation that new measures in the property market will reduce earnings, hit shares of mainland-based developers yesterday. Sino-Ocean Land Holdings, which had its trading debut in September, dropped 2.61 per cent to HK$8.97, while Soho China, a Beijing developer that raised US$1.9 billion in a Hong Kong initial offering in October, fell 1.76 per cent to HK$7.80.