BEIJING - China may see an increase in property transactions involving international investors this year, fuelled by the economic recovery and the rosy outlook of China's commercial properties, industry experts said.
"On the one hand, a number of deals are in the pipeline after lots of negotiations were conducted last year. On the other hand, the top management of international real-estate funds are also under pressure because few deals were concluded last year," Mr Andy Zhang, managing director of Cushman & Wakefield China, told China Daily.
Shanghai's office- and retail- property sectors will see significant increases in large-scale deals this year, supported by investors' strong interest in commercial real estate, according to a research report by international property consultant Knight Frank.
China, in particular the city of Shanghai, is still a focus for multinational companies mulling over expansion and new business opportunities, so demand for commercial and residential property will remain buoyant, said Ms Regina Yang, director of research for Knight Frank Shanghai.
Despite the overseas economic turmoil and China's slowing economic growth, retailers' confidence in the market is intact and they continue to open new stores in Shanghai, said reports in China Daily.
According to real-estate fund LaSalle Investment Management, the best opportunities in China's mainland real estate this year lie in warehouses, offices, hotels, retail and mixed-use developments.
Stabilised modern warehouses offer compelling entry prices and secure income in many countries, with China at the top end of expected returns. In addition, the development of modern logistics facilities in select regions is very attractive, the fund told the daily.
"These projects will benefit from infrastructure investment and a steady efficiency drive within the nation's logistics network," said Mr Jacques Gordon, international director of LaSalle.
For Mr Henry Sim, executive director of Industrial & Logistics Services at CBRE, there are several deals related to business parks in the pipeline, involving international real-estate funds.
"Although there are not many lucrative business-park projects at the moment, I believe more opportunities will pop up in the coming two to three years, along with China's quickened urbanisation process," said Mr Sim.
As the grade A and grade B office-rental gap widens, grade B offices at core locations in first-tier cities offer upgrading potential through asset and tenancy improvements, LaSalle's research note showed.
Hotels are considered good investments because the best opportunities are in assets that provide stable, core-like returns but are not traditionally perceived as core.
"In hotels, repositioning mismanaged domestic-brand hotels in China should yield fairly good returns," said Mr Paul Guest, regional head of research and strategy at LaSalle Asia-Pacific.
Retail remains compelling, although location is vital and deal flow limited. Prime retail in select first- and second-tier cities in China is among areas to watch.
Get My Paper for more stories.