China’s super-rich investors eye Shanghai hotels for scarcity value, tourism appeal
High-net-worth individuals and corporate investors accounted for 88 per cent of all property deals in Shanghai last quarter, according to JLL
China’s billionaire investors are looking to pick up luxury hotels in Shanghai while institutional investors like insurers and real estate investment funds and private equity giants take a back seat, as economic stability rekindles risk appetite, according to JLL.
“Investors’ concentrated allocation towards core-area assets reflects not only a stabilising risk appetite, but also highlights the scarcity value and resilience of Shanghai’s core-area assets,” she added, declining to identify the hotels targeted by the billionaires.
Their appetite could inject confidence in Shanghai’s slumbering property market. Transaction value of office buildings, rental-home projects, shopping malls and hotels slumped 29.7 per cent to 23 billion yuan (US$3.2 billion) in the first six months from a year earlier, data compiled by CBRE showed.
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Average transaction value fell 25 per cent to 360 million yuan in the second quarter from the preceding three months, according to JLL, with high-net-worth individuals and corporate investors contributing 88 per cent of the 23 deals, Sun said.