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CN China's offshore real estate investment up 25%

Property Here - Friday, November 15, 2013

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Chinese offshore property investment surged 25 percent year-on-year at the end of Q3 2013, according to Jones Lang LaSalle. 

For the year, volumes exceeded US$5 billion (S$6.2 billion) beating the previous record of US$4 billion (S$5 billion) set in 2012.

Offshore investment growth in China is in line with the expansion of the domestic investment market, which grew 17 percent quarter-on-quarter.

The consultancy noted that while locations for offshore capital have remained consistent, Chinese real estate investors appear to be most active in the US, Europe, Singapore and Australia.

Interest in Europe has risen since 2012 with transaction volumes up 25 percent year-on-year to nearly US$2 billion (S$2.5 billion).

David Green-Morgan, Research Director of Global Capital Markets at Jones Lang LaSalle, said: “Europe was an early focus for the Chinese investors with a number of deals completed in the UK over the last three years. This has continued in 2013, but the focus has widened, and we have seen deals occur right across continental Europe with increased investor interest in Southern and Central Europe.”

“However, the UK remains the most sought after market in Europe as core residential and office assets in Central London remain popular with investors looking for high yields.”

Increased investor appetite was also seen in the US, Singapore and Australia with Chinese investment into commercial real estate.

In Singapore, a US$1 billion (S$1.24 billion) mixed-use hotel and retail scheme was sold to Bright Ruby which is controlled by China's Du family, making it the single biggest commercial property transaction in the city-state.