Property curbs to have impact

By Zhang Yu (China Daily)
Updated: 2006-10-24 09:10
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SHANGHAI: The central government's curbs on foreign investment in the real estate sector have yet to dampen institutional investors' ardour for purchasing properties in Shanghai, according to industry experts.

Singapore-based Ascendas, a leading business space provider in Asia, has already signed a contract to purchase Ocean Towers, a high-end office block in downtown Shanghai, at a price ranging from 160 million yuan (US$20.3 million) to 180 million yuan (US$22.8 million), according to top real estate firm Jones Lang LaSalle.

"Though several negotiations were on hold as overseas institutional investors reworked their investment strategies, on the whole, foreign institutional players remain greatly interested in participating in China's economic growth as long-term property investors," said Kenny Ho, associate director of the research department at Jones Lang LaSalle's Shanghai office.

As the latest report from Jones Lang LaSalle indicates, at least 16 properties, mainly offices and residential buildings, have been snapped up by foreign investors in the first three quarters of this year, with the total trading price estimated to exceed 8 billion yuan (US$1 billion).

Ho said he was confident that there would be 20 such deals this year double last year's figure.

Most of the buyers are powerful international investors such as Morgan Stanley and Citigroup. Morgan Stanley and associates have reportedly acquired East Ocean Plaza from Zhejiang Greentown Group, a domestic property developer, for 245 million yuan (US$31 million).

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