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Greenland sees change in attitude among Chinese buyers of property
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At the end of last year, Greenland Group launched its first project in the UK, the Ram Quarter in Wandsworth in southwest London after purchasing the site from Minerva Ltd in early 2014. Shanghai Daily talked with Elva Shi, marketing manager at Greenland Overseas Sales Center, about the London project, buyers’ sentiment and the group’s strategy.
Q: What is the sentiment of Chinese overseas property buyers that you have observed in the past few years?
A: It has to do with Chinese people’s concept about the property market and the overheated domestic housing market in the past decade.
We’ve seen the trend that Chinese buyers that seek to purchase overseas property don’t care that much about investment returns nowadays because they have a generally optimistic outlook about the property market in developed countries.
With a relatively low down payment ratio, the loan interest could generally be covered by rent income. Chinese people who plan to immigrate to developed countries or send their children to study overseas want to purchase their house in advance to make better arrangements for their family members.
For example, property prices in Australia increased about 20 percent in the past two years due to an influx of Chinese investors.
On the other hand, it is generally acknowledged that the best time for investment in China’s property market is over, and there is little space for growth in most first-tier cities’ residential property.
A strong yuan against other foreign currencies such as the euro and Australian dollar is also a driving force for Chinese
buyers to go overseas.
Q: What’s special about Ram Quarter properties compared with other Greeland projects?
A: In January 2014, Greenland bought the historic 28,328-square-meter site Ram Brewery, which would be built into 661 new homes, including a 36-story tower providing 166 flats and 9,900 square meters of space for new shops and restaurants.
The Ram Quarter property is different from other overseas projects in a number of aspects. First of all England is not a traditional immigration destination for Chinese people, unlike Canada, America and Australia. England’s richest resource is education, especially college education, which is well known around the world. It has a large number of top universities.
Schools nearby include St Anne’s C of E Primary School, rated “good” by Ofsted, and Ashcroft Technology Academy (seniors) which the government’s schools’ watchdog considers to be “outstanding.”
The original stables and brewery building were also retained when Greenland purchased the site, so potential buyers are those who have the financial capacity as well as those who understand the value of keeping links to the past. Other properties are mostly investment driven.
Q: What has been the initial reaction to the project? Does Greenland have future plans in England?
A: It has been warmly welcomed by local residents because the Ram Brewery is a historical site and locals know the value of this place. It’s not in the geographical center or like the landmark of the city but a very inhabitable area within reach of all sorts of facilities.
We sold about 100 flats in phase one after the first two weeks of the launch and most of them are local buyers.
The second phase of the project is a high-rise residential building that is expected to go on sale at the end of this year.
Greenland is also planning one of the tallest residential buildings in Europe in London’s Canary Wharf, which is a more conspicuous landmark in the city center.
Q: What’s Greenland’s strategy in developing overseas property projects? What kind of service are you offering?
A: Greenland will continue to focus on the central downtown area of selected metropolises in developed countries in terms of expansion plans. We currently have 10 projects on sale in seven countries, and all of them are apartment buildings.
Developing properties in Europe requires a higher threshold than investing in America or Australia. Plus we have a longer history compared with other developers in overseas markets and our largest advantage is our scale because we started off quite early.
We have a lot of partners in the banking, legal and property management industries because we have an extensive network in overseas countries, we’re able to offer a one-stop service for our potential customers.
Last year, Greenland also launched an exhibition hall and reception center in Shanghai to give potential buyers better service.
We have come to realize buyer are not just purchasing property, but are looking for an overall understanding of the country where they are buying real estate, including immigration rules and purchasing restrictions. It’s more like a market education process for us as well as for potential buyers.
We may launch at least three new projects in New York, London and Melbourne this year, and sales would nearly double from last year’s 15.3 billion yuan (US$2.47 billion).
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