Home prices in Beijing and Shanghai, which have surged this year, have room to rise further as the inflow of residents bolsters demand in China’s biggest cities, said the head of real estate investments at Singapore’s sovereign wealth fund.
Despite some short-term volatility, the long-term outlook for the China’s real estate market is solid given its growth prospects, Goh Kok Huat, president of GIC Pte’s real estate unit, said in an interview on Wednesday with Bloomberg Television’s Haslinda Amin in Singapore. Retail properties face consolidation in China’s cities as more consumers turn to online shopping, he said.
“The rapid rate of urbanization creates demand for housing” in first-tier and major second-tier cities, Goh, 51, said. “If you look at Shanghai and Beijing, residential prices are still very, very robust; demand is still very, very robust.”
China’s government has embarked on a host of stimulus measures to boost property prices amid signs of an economic slowdown, helping to reverse a year-long decline in May. The price increases have been most evident in the four first-tier cities including the capital of Beijing and the financial hub of Shanghai, while smaller cities have shown lower growth or even continuing price declines. In its latest national plan, China affirmed a target of boosting its urban population to 60% by 2020.
Picking spots
As an investor in China, “you need to pick your spot,” Goh said. In particular, in the retail sector, GIC’s strategy is to go for “increasingly dominant centers.”
Singapore’s sovereign wealth fund, founded in 1981 and an early investor in private equity and property, is underinvested in real estate, Goh said on Wednesday. Low interest rates worldwide have made investing in the area “tougher and tougher,” he said. Returns from investing in real estate are likely to be low in such an environment, according to Goh, and prices are high in some top-tier cities global, such as London, Singapore and Hong Kong.
“It’s always hard to say whether we are in bubble territory, but they are certainly aggressive,” Goh said.
The state fund has about 7% of assets in real estate, while it can invest 9% to 13%, Goh said. GIC doesn’t disclose the size of its assets under management, though the London-based Sovereign Wealth Center puts its total holdings at US$343 billion ($485 billion), making it the world’s sixth-biggest sovereign wealth fund.
‘
Click Here To Register For Free Trial Services OR Give A Missed Call : +6531581402 Follow Us On Twitter : www.twitter.com/epicresearchsg Like Us On Facebook : www.facebook.com/EpicResearchSingapore Need Any Assistance Feel Free To Mail Us at : info@epicresearch.sg
Despite some short-term volatility, the long-term outlook for the China’s real estate market is solid given its growth prospects, Goh Kok Huat, president of GIC Pte’s real estate unit, said in an interview on Wednesday with Bloomberg Television’s Haslinda Amin in Singapore. Retail properties face consolidation in China’s cities as more consumers turn to online shopping, he said.
“The rapid rate of urbanization creates demand for housing” in first-tier and major second-tier cities, Goh, 51, said. “If you look at Shanghai and Beijing, residential prices are still very, very robust; demand is still very, very robust.”
China’s government has embarked on a host of stimulus measures to boost property prices amid signs of an economic slowdown, helping to reverse a year-long decline in May. The price increases have been most evident in the four first-tier cities including the capital of Beijing and the financial hub of Shanghai, while smaller cities have shown lower growth or even continuing price declines. In its latest national plan, China affirmed a target of boosting its urban population to 60% by 2020.
Picking spots
As an investor in China, “you need to pick your spot,” Goh said. In particular, in the retail sector, GIC’s strategy is to go for “increasingly dominant centers.”
Singapore’s sovereign wealth fund, founded in 1981 and an early investor in private equity and property, is underinvested in real estate, Goh said on Wednesday. Low interest rates worldwide have made investing in the area “tougher and tougher,” he said. Returns from investing in real estate are likely to be low in such an environment, according to Goh, and prices are high in some top-tier cities global, such as London, Singapore and Hong Kong.
“It’s always hard to say whether we are in bubble territory, but they are certainly aggressive,” Goh said.
The state fund has about 7% of assets in real estate, while it can invest 9% to 13%, Goh said. GIC doesn’t disclose the size of its assets under management, though the London-based Sovereign Wealth Center puts its total holdings at US$343 billion ($485 billion), making it the world’s sixth-biggest sovereign wealth fund.
‘
Click Here To Register For Free Trial Services OR Give A Missed Call : +6531581402 Follow Us On Twitter : www.twitter.com/epicresearchsg Like Us On Facebook : www.facebook.com/EpicResearchSingapore Need Any Assistance Feel Free To Mail Us at : info@epicresearch.sg
0 comments:
Post a Comment