Home prices in China are up after 9 consecutive months of steady decrease. Hopeful investors and developers are preparing for a retail boom.
According to Channel News Asia, China’s property market is starting to rebound. As developers look for growth through retail and commercial property, home prices continue to struggle after being in a downward trend for more than 2 years. That being said, the average home price in China’s 100 major cities were up 0.3% in July, based on data from the China Real Estate Index System (CREIS).
So what does all this mean for developers, investors and retailers looking to expand their presence in Asia? Asia’s Chief Executive Officer, Lim Beng Chee of CapitaMalls said:“The minimum wages will increase. I think the government policy is to bridge the gap between the rich and the poor. To us, it is advantageous because our malls are targeted at the mid to upper segments of the population. So the moment the middle class increases, they will spend money in our mall, and that obviously will come through our retailer sales and rental yield.”
Hong Leong Group (Singapore) will be investing US$280 million (1.8 billion yuan) to build a complex with a hotel, shopping mall and business apartments, in the western province of Sichuan. Their chief representative in Chengdu, Wang Gongyi, believes there is still room to grow: “There are no signs of a property bubble. We’re at least safe for the next few years.”
Market data service and consulting company Getchee, based in Tapei, has been helping retail brands penetrate and thrive in the Asian market for over 11 years. Their experts believe that there are two major trends happening in China; faster development in Tier 2 cities, and rising rental rates throughout China. Follow the discussion on their blog.
CapitaMalls and Hong Leong Group will be present at MIPIM Asia this November. For direct access to their chief representatives, visit the MIPIM Asia website to register!
Top image credit : Photobank gallery