They are betting on real estate becoming more affordable and citing the first green shoots of recovery in the Chinese economy as a sign that their instincts are correct.
Shui On Land plans to raise funds to finance projects amid an improving mainland home property market, the firm's new chief financial officer and managing director Daniel Wan Yim-keung said.
Even if property prices fall further the company is convinced now is the right time to move. The signs of recovery in the mainland residential real estate market in the first quarter of 2009 was encouraging, Wan said.
'I cannot guarantee home prices will not fall further but another 30% slump is very unlikely. Many homebuyers may seek to enter the market if home prices drop more than 10%,' Wan added.
Indeed the latest research from Colliers International shows that local investors have dominated Shanghai's real estate investment market in the first quarter of 2009 while foreign investors continued to slow down their expansion plans.
The first quarter witnessed more local insurance companies entering the direct real estate investment market and aggressive acquisitions made by state-owned enterprises.
Colliers said the forthcoming trend is that more local investors will jump on the bandwagon in the investment market during 2009. also sales volume of residential property in Shanghai bounced 20% in April from March, and surged 84% from a year earlier.
But Wan believes that interest from foreign investors is coming back to mainland China. He said that funds from the US, Europe, Canada and the Middle East have shown an interest to become strategic investors and the company is close to reaching a deal with a European fund.
