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Mainland firms tap overseas markets
Brief:Developers look to build abroad to cater for wealthy Chinese seeking more investment opportunities or those planning to emigrate.
Mainland property developers are expanding into overseas real estate markets to cater for a rising demand from Chinese buyers.Banking on the expertise they have developed in local markets, and their understanding of the needs of mainland buyers, the developers decided to take the competition to global rivals and build properties abroad targeted at buyers from home.

In their sights are wealthy locals who are restricted under current regulations from buying more investment properties on the mainland, as well as those planning to emigrate or buy holiday homes.

The developers were also stung into action by a growing number of foreign projects being marketed to local buyers in the wake of economic uncertainties in their own markets. In the past few months an increasing number of developers from Britain, the United States, Italy, Switzerland and even the Bahamas have beaten a path to Hong Kong and several mainland cities to push their projects.

"For several years now, wealthy mainland buyers have shown a keen interest in migrating overseas. This creates a market," said William Xu, general manager of marketing for Guangzhou-based Yihe Real Estate.

"Privately-run Yihe developed its first overseas project in Sydney, and planned to expand into the US and Mauritius" said Xu, "Mainland Chinese are not too familiar with overseas markets. They would prefer a mainland brand they are familiar with, rather than an overseas developer," said Xu. "They would like to think that if there are any problems they can go back to the mainland to look for the developer."

Yihe began building a three-tower apartment building, known as Summer Court, in Sydney in August last year and plans to top out the project by the end of this month. It prelaunched the development to buyers in Guangzhou in February this year at a price of around 35,000 yuan (HK$42,650) per square metre and has reportedly sold more than half of the 70 apartments on offer.

To attract buyers it offered free migration consulting services as well scholarships for the buyers' children.

Analysts said other ambitious domestic developers might be looking to follow the example of such offshore investors, particularly as the mainland housing market continued to shrink under the pressure of government curbs.

Juwai
Tags:Mainland
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