CBRE Report on Asian Real Estate Market

The latest report published by CBRE “2007, Report on Asian Real Estates Market ” indicates that international and domestic investment organizations in Shanghai, Beijing, and Guangzhou still show great interest in the purchase of large mature properties. And with the implementation of a new policy on land transfer, the price of industrial land and the rental fee of industrial property have more or less increased. In Shanghai, the average price of industrial land has increased by 3.2%.
In the first quarter of 2007, there were many cases in which international investment organizations purchased property in Shanghai, i.e. Morgan Stanley purchased 219 residential property projects in Yongxincheng in Xu jiahui; Japanese company NewCity Corp. purchased logistic warehouses in Waigaiqiao. With regards to industrial property, the new regulation of “inviting tenders, auction and hanging out shingle” has been implemented throughout China. The average price of industrial land has experienced a period-on-period growth of 3.2%, reaching 879.4RMB/sq.m; and the rental fee of industrial property has increased by 2.5%, reaching 38.5RMB/sq.m.
In Guangzhou, more and more investors have shown great interest in purchasing office buildings. Because of the lack of A-level office building, many investors have changed the original purpose and turned back to B-level office building. In one quarter, the biggest transaction of transferring property was done by Shenzhen Zhonghang and Guangdong Yilang; they purchased Zhongxin Square which is a combination of residential and commercial property. The price of industrial land in Guangzhou has also increased, but the increase doesn’t hit the enthusiasm of the investors to invest in Zhujiang Delta.
Logistic real estate has been the most striking investment point in Beijing. Many international logistic property developers including AMB, Prologis and Mapletree have been looking for the investment opportunities. These investors lay great emphasis on the mature industrial zone, i.e. Shunyi Tianzhu zone in the northwest and Tongzhou Majuqiao zone in the southeast of Beijing. At the same time, Hong Kong Swire Pacific Ltd., and Carlyle Group have announced that they will invest in the real estate market in Beijing. Some insurance companies have also fallen in alongside purchasing buildings.