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News & opinion

21 OCT 2018

Considerations for investing in mainland Chinese property

Chief Investment Officer of Link Asset Management Christine Chan MRICS shares her insights on the opportunities of investing in mainland China's retail property ahead of her keynote presentation at our upcoming Global Urban Economic Summit.

Intensifying urbanisation brings us two new themes for urban development in China:

  1. How can we advance the urban regeneration and reconstruction of old areas in first- and second-tier cities?
  2. How do we develop new areas in third- and fourth-tier cities?

These inevitably connect with issues like population migration, consumption upgrading and market transformation, and will attract domestic and foreign developers, and investors who want to invest in commercial property.

Investment in urban regeneration

While retail markets in China are not as active as office buildings, industrial units and other property types, they are seeing significant growth in China. Developments such as shopping malls in core districts, which are usually close to residential areas, metro lines and traffic hubs, present opportunities for investors, as these often attract new types of businesses and experimental services.

At Link Asset Management, we've seen success in many of our retail property investments, such as EC Mall in Beijing, and Metropolitan Plaza in Guangzhou. Increasing rent and asset appreciation rates are favourable, which vindicates our unique investment strategy.

The importance of cooperation

All cities, from third to fourth tier, are now midway through a transformation. New retail developments being created in these areas are having a domino effect on services required to support these developments, such as residential, educational or medical facilities. This also has an impact on city infrastructure as the load on core traffic areas and other social facilities is lightened.

If local government is willing to support and work with retailers — issuing beneficial policies on tax, investment, approval processes etc — it will help attract investment into new retail developments. However, there is inherent risk if local government does not cooperate with consistent and concise policies around the changes of land property and remaining years of land use.

About the Global Urban Economic Summit

The RICS Global Urban Economic Summit (GUES) will be held from 14–16 November 2018 in Tianjin.

The Summit is a global gathering place for professionals, developers, operators and stakeholders, to share knowledge, skills and resources. It aims to help decision-makers create and manage the urban economic development that the world’s future populations need. The event sets a standard for dialogue and co-operation that is vital for the industry.

About Chistine Chan & Link Asset Management

Christine joined Link Asset Management in 2013, acting as the Supervisor of Asset Investment, and has been working in property and fund asset management for over 20 years. Christine has significant experience in property, debts and equity investment in Greater China, as well REITs and private equity funds.

Link Asset Management is Asia’s largest property investment trust and one of the largest retail-oriented property investment trusts globally. In the past few years, the company has devoted itself to searching for investment opportunities for commercial property in Greater China, especially retail property in first- and second-tier cities.

  1. Christine Chan MRICS
  2. Shopping mall in China
  3. EC Mall, Beijing
  4. Inside a retail building