New Commercial Funds to be used for Property Expansion in China

Published By : 16 Jun 2014 | Published By : QYRESEARCH

The biggest bank in Switzerland UBS AG (UBSN) will be expanding its China’s property investment business by moving into commercial real estate.

In the month of May, China’s home sales declined by 11 percent from the previous year. According to the National Statistics Bureau data, the value of real estate has declined to USD 72 billion compared to the same month in previous year.

In an interview the head of the global real estate for the Asia-Pacific zone at USB Global Asset Management, Trevor Cooke said that the retail, office, and industrial properties are the sector where the demand is shifting towards. Cooke also stated there has been a growth of around 35 percent per year in the stock investment grade assets in China. According to him the bank will be forming a partnership with either a developer or with a company which will be able to source existing assets.

It is expected that many cities in China will soon have improved rental demand for commercial space. This is due to the recent regulatory changes in policies which aid growth in certain areas. According to a market report, China is one of the most sough-after markets for many retailers who are aiming to open new stores this year.

USB has already invested directly in China’s residential property in a joint venture created during 2008 with Gemdale Corp. which is a Shenzhen-based developer. Now, the bank is planning for another residential fund which will have an initial close of around USD 100 million with a total of at least USD 350 million according to Trevor Cooke.
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