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June 21, 2017

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Commercial property investment to rise

COMMERCIAL real estate investment in China will jump 45 percent to 260 billion yuan (US$38 billion) by 2020 from 2016, property service provider CBRE said in its latest report.

And the market is expected to shift into a medium-liquidity phase around 2025 as it continues to mature.

The gateway cities of Beijing and Shanghai, among others, will see a combined 60 percent of the country’s commercial real estate transaction volume in 2020.

Six high-potential cities — Guangzhou, Shenzhen, Chengdu, Chongqing, Tianjin and Wuhan — are forecast to account for 36 percent of the additional transaction volume, according to the report, “Towards 2020: China Investment Strategy.”

“Looking ahead, six fundamental drivers — infrastructure, urbanization, the Belt and Road initiative, the Made in China 2025 strategy, demographic shifts and upgraded consumption — are expected to shape commercial property investment strategy,” said Sam Xie, CBRE China head of research.

“Enhanced demand, increased allocations and a rising Transaction Activeness Ratio will substantially drive the asset value of prime commercial real estate.”

In the next four years, more domestic institutional investors will look toward commercial real estate as a smart addition to their investment portfolios.




 

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