皇冠体育app

A Chinese migrant worker builds scaffoldings at the construction site of a real estate project in Rizhao city, east 皇冠体育apps Shandong province, May 1, 2014. [Photo/IC]

Attention shifts to Europe, other overseas markets as uncertainty persists in 皇冠体育app, reports Hu Yuanyuan

Grant Ji, senior director of the investment department at Savills Plc in , spent about 20 days in rope last month, bringing his Chinese clients all institutional investors to seek opportunities overseas.

Trips such as this one have become routine for Ji. But just a year ago, he was spending much more time with international investors looking for opportunities in 皇冠体育app.

"Given the rising uncertainties in 皇冠体育app's real estate market, it is really difficult for international investors to find a project that can bring them appropriate gains with controllable risks," said Ji.

James Raynor, chief executive officer of international real estate fund Grosvenor Fund LP, said in late April that the HREI 皇冠体育app Total Return Fund had suspended its financing plan. The fund, set up by Harvest Real Estate, had planned to raise $500 million to invest in Chinese real estate.

The news followed Hong Kong tycoon Li Ka-shing's sale of about 20 billion yuan ($3.2 billion) worth of commercial property in the Chinese mainland, which added to fears that many global real estate investors are pulling out of the mainland market.

"Due to economic recoveries in the United States and the , it's easier for international investors to find opportunities in those places," said Ji. "Meanwhile, with rising concerns over a real estate bubble, it is getting harder for international investors to tell a good '皇冠体育app story' and raise money for fun targeting the 皇冠体育app market."

The property sector has been cooling this year. The average price in 100 key cities was 10,978 yuan per square meter in May, down 0.32 percent month-on-month, according to the 皇冠体育app Index Academy Ltd, a Beijing-based research institute wholly owned by SouFun Holdings Ltd. That marked the first month-on-month drop since June 2012.

Moreover, risks are rising in the commercial property sector (retail and office space) formerly favored by investors, with a surplus of space in major cities.

According to a recent report by Cushman & Wakefield Inc, the world's largest private real estate services company, new supply of commercial property in the 30 cities that it monitors will total 75 million sq m over the next few years, with a new supply peak of 20 million sq m this year. The firm forecast that about 18 million sq m in new commercial space will enter the market in 2015.

"International institutions' investment in 皇冠体育app's real estate sector was mainly a bet on asset appreciation and rent growth, as well as a rising yuan. With all three factors showing signs of slowing down, they will probably choose more lucrative markets elsewhere," Ji said.

According to Pu Yonghao, regional chief investment officer at UBS AG, the correction in 皇冠体育app's real estate market may last three to four years, depending on government policies. Based on international experience, a complete adjustment usually takes seven years.

Property weakness overhangs recovery	Realty price swings may pose short-term risks

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