Guangzhou and Shenzhen

Guangzhou and Shenzhen have become increasingly important targets after Shanghai and Beijing for institutional investors.

In July, Pramerica signed an agreement with a Shenzhen local developer to pay US$118 million for a 50 percent stake in Central Walk Shopping Mall, an under construction shopping center.

And Ping An Insurance kicked off the largest acquisition in the Guangzhou and Shenzhen market by buying CITIC City Plaza in Shenzhen for two billion yuan (US$256 million).

These deals, together with some others still under negotiation, indicated a strong interest on both cities' office and retail sectors from core investors.

Opportunistic funds are looking into residential development projects in cities across Pearl River Delta region while others adopt a repositioning strategy in converting residential developments into serviced apartments.

Investment activities are expected to increase this year due to favorable market fundamentals, probably encouraged by the expansion and upgrade demands from both MNCs and domestic firms in the region, the higher-than-national-level disposable income, and more experienced developers supplying higher quality properties, the reported predicted.

Chengdu

Chengdu's investment market started to draw attention from foreign investors last year.

The main focus was on distressed assets, with a total of approximately 200,000 square meter of gross floor area transacted.

For instance, Shui On Group acquired Huitong Building, the largest distressed asset in Chengdu, through a public auction at a total price of US$50 million for 66,000 square meter of GFA.

And Lippo Group invested US$30 million to develop Lippo Tower, another distressed asset with 70,000 square meter of GFA, by partnering with a local developer.

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