He also said the prices of multi-storey residential properties were generally lower than those of high-rise buildings, with projects involving lower construction costs and management fees on completion.

These multi-storey residential buildings, usually with seven storeys or less, are aimed mainly at mainland Chinese buyers.

Mr Xu also said Shum Yip would continue to expand its presence in commercial and office developments which could account for 70 per cent or more of the group's total portfolio.

To date, commercial and office developments represented about half of the company's portfolio, with the remainder mainly residential projects, he said.

The company also has industrial and godown projects.

It now has about 10 property projects in China, mainly in Shenzhen.

Mr Xu said the adverse effect of China's austerity programme and credit squeeze on Shum Yip's business was limited although many small real estate firms faced difficulties in surviving.

He said Shum Yip had established good business links with the banking industry, and the company managed to source capital from Hong Kong for its developments.

''As a mainland-backed concern, we are more familiar with property market conditions in China and have an edge on exploring the market,'' he said.

Mr Xu said the credit squeeze and macro economic measures actually created better opportunities for financially sound companies to pursue projects and secure better deals in China.

In terms of the company's expansion, he said Shenzhen would remain the focus of its property development but it would also develop projects in northern China.

The impending introduction of a national land appreciation tax would not affect Shum Yip's property business, said Mr Xu.

''Shenzhen has imposed capital gains tax on property developments for a long time.

''The proposed national levy is similar to the one in Shenzhen,'' he said.

''We are already familiar with the tax's structure, and we have taken into account the tax's impact on the cost and profits of our projects before we committed ourselves to the developments.'' Besides Shenzhen, Shum Yip has property projects in Harbin, Qingdao and Hainan.

The company successfully sold all the units in its commercial-residential development, the Hua Min Building in Shenzhen, generating about $430 million.

The property is a 28-storey building at Renmin Road with a total gross floor area of about 277,710 square feet.

In Shenzhen, Shum Yip is also developing the Fu Xing Building, with a floor area of 531,720 sq ft, and the Di Wang property project which is a joint venture with Kumagai Gumi (HK).

The Di Wang project, comprising a 64-storey office tower and a 32-storey service apartment block on a four-storey retail podium, is expected to be offered for sale later this year.

The other project is a two-block residential development at Shennan Dong Road, with a floor area of 412,850 sq ft.

Shum Yip was involved in property projects in Hong Kong, but the company shifted all its efforts to the mainland market because of high property values and the rising investment risk in the territory.

The company is the property subsidiary of mainland-backed conglomerate Shum Yip Holdings, which is the Hong Kong trading and investment vehicle of the Shenzhen Government.

Shum Yip Holdings is engaged in a wide spectrum of businesses ranging from international trade, property, finance and investment to transport, insurance, tourism and manufacturing activities.