Scores of state-owned enterprises have been ordered to get out of the property market and concentrate on their core businesses. The order, from the State-owned Assets Supervision and Administration Commission (Sasac), is intended to rein in runaway property prices. It is seen as a reaction to mounting criticism that SOEs have bid up land prices to record highs since a property market boom began last year. An analyst said the measure would not stop the buying spree by state firms but rather strengthen the purchasing power of those still in the market. Sasac said the 16 state-owned companies whose primary business is property will be allowed to continue property development. The approved state-owned developers include China Poly Group, China State Construction Engineering (parent of Hong Kong-listed China Overseas Land & Investment), China Resources Group and China Merchants Group. The 78 companies banned from the market were urged to restructure and concentrate on their core businesses. They won't be forced to sell their existing developments, but they will not be allowed to invest further in real estate once their current projects are completed. '[It is] very interesting ... The 16 will get much bigger,' said Lee Wee Liat, an analyst at Nomura International (Hong Kong). The total value of the property assets of the 16 remaining state-owned companies in the market was 561.6 billion yuan (HK$637.5 billion) last year, accounting for 85 per cent of the property owned by state companies, according to the website of People's Daily. The companies' earnings from property sales last year -189.9 billion yuan - accounted for 86 per cent of the money SOEs earned from such sales. Lee, of Nomura, said: 'The 78 account for only 15 per cent of [SOEs' property] profits, revenue and assets ... That is because they have not been actively developing the land bank they have. 'I think these 78 could have a lot of very good quality land at prime locations. These will likely be sold to the other 16 state-owned developers,' he said. 'They will get bigger.' The new edict comes on the heels of Monday's sale of two sites for record prices. Both buyers were state-owed companies. The sales occurred just 10 days after Premier Wen Jiabao pledged in his annual report to the National People's Congress to curb soaring home prices. On Monday, a plot of residential land in Dongsheng, Beijing, was auctioned for 28,000 yuan per square metre, the highest price ever paid in the city. The buyer was China Ordnance Equipment Group, a military company. At a separate auction, a 185,000 square metre residential site in Yizhuang went for 5.25 billion yuan, the most ever paid in a single land transaction in Beijing. The buyer was a unit of Citic Group, a state-owned company. State-owned companies invested actively in the real estate industry to make quick profits during the property boom last year. Property analysts said state-owned companies had an advantage in the bidding for development sites because of their close relationships with the government and their vast capital base. Early this month, a member of the Chinese People's Political Consultative Conference, Zhang Hongming, used a speech at the political advisory body's annual meeting to urge state-owned companies to leave the real estate sector. Property prices mainland-wide rose 10.7 per cent in February from a year earlier. But prices have increased more than 80 per cent in certain segments of the market, such as high-end housing in cities such as Shenzhen, Beijing and Shanghai. Land prices have been even hotter, more than doubling in the past year. Kong Qingping, chairman of China Overseas Land & Investment, said the mainland's real estate sector was market-oriented. He believes land prices will become more rational this year with banks tightening up on lending and the steps the government is taking to regulate the red-hot market.