CHINESE real estate developer Canada Land Limited has engaged Colliers International to look at buying up distressed properties in Greater China.
Chairman Dr. William Yip plans to establish the CDL China Real Estate Opportunity Fund which will seek to exploit the current correction in the Greater China real estate market in order to achieve maximum long-term gains.
Dr Yip said the current global economic downturn and numerous fundamentals have set the stage for one of the most lucrative investment opportunities in recent years and in the history of Chinese real estate.
“We believe that capitalizing on the current correction in Chinese real estate requires extensive market analysis and due diligence as well as a focus on quality over quantity, an investment strategy that’s weighted toward multi-family, multi-tier residential developments, and an ability to leverage strong relationships with Chinese government authorities and the local real estate community.
“To that end, we will work with a group of seasoned investment professionals and our preferred real estate services provider, Colliers International,” he added.
Dr. Yip cited numerous reasons for China’s real estate investment appeal, including;
· The Chinese government, recognising that economic growth has previously been overly weighted toward exports, is now shifting the economy to a more balanced growth model with heavier emphasis on domestic consumption. Backed by more than $US2 trillion in foreign currency reserves and very little debt, the Chinese government already has fired the first salvo with a $US585 billion infrastructure stimulus package equal to 20% of total GDP in 2008.
· Chinese banks, which require 30% or more in equity (cash) for all mortgages, do not have the exposure to subprime loans and toxic debt that have afflicted other markets.
· Demand for housing in China far exceeds supply, with an estimated shortfall of 6.8 million units.
· China is an emerging economy with an industrious population that maintains some of the world’s highest rates of personal savings, and home ownership is highly esteemed.
Australian Property Journal
