Commercial property investment market tipped to pass 300 bn yuan nationwide

Cao Qian
Double-digit growth phase will extend for another year in 2022 amid continuously improving buyer and seller sentiment, CBRE said.
Cao Qian

China's commercial real estate investment market is expected to surpass the 300-billion-yuan (US$47.37 billion) mark in 2022, according to a latest forecast by global property consultancy CBRE.

The achievement will extend the market's double-digit growth phase for another year amid continuously improving sentiment among both sellers and buyers, CBRE said.

En bloc real estate investment deals around China may increase 10 to 15 percent from 2021, which registered 273 billion yuan in transaction volume, a 33-percent growth from 2020.

"Purchasing intentions among domestic and foreign investors have both strengthened, with interest from overseas buyers being particularly strong," said Sam Xie, head of research, CBRE China.

"An investor intentions survey conducted earlier by CBRE found that a record 59 percent of respondents intend to buy more this year, while the proportion of respondents who plan to sell more also increased by 10 to 51 percentage points."

Notably, around 60 percent of domestic developers have expressed their intentions to sell more assets this year, mainly due to debt repayment pressure as well as the "three red lines," a scheme to limit developers' debt ratios.

Meanwhile, property funds' willingness to sell also has increased by 20 percentage points as some are approaching their expiry date, according to the survey.

"Considering that most assets acquired by property funds between 2017 and 2019 were located in prime locations in Shanghai and Beijing, this year is likely to provide investors with attractive cyclical opportunities to acquire prime office and retail assets in the two gateway cities, both named among the top five cross-border investment destinations in Asia Pacific," Xie said.

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