Greenland picked up this Melbourne site in October
Greenland Group, the state-owned real estate firm responsible for some of China’s biggest overseas acquisitions during 2013, has plans to spend between US$5 billion to $8 billion more to buy up international assets during 2014.
Having achieved 162.5 billion in property sales last year, up 53% over 2012, Greenland appears to be cashed up and ready to develop new projects overseas, as its Chinese customers look for fresh markets for real estate investment.
Looking for Projects and Profits Outside of China
Cited in a story by Esther Fung in the Wall Street Journal, Greenland’s chairman, Zhang Yuliang noted, “Regarding our overseas projects, we will grow alongside the middle class population in China [which has been increasingly purchasing overseas property]”
Since China has restricted opportunities for wealthy Chinese to buy additional homes domestically (in order to keep a lid on escalating housing prices) more affluent mainlanders have been buying up units in foreign markets. And Greenland already started profiting on this trend.
In the case of a project that Greenland bought in Sydney, Australia last year, after acquiring the unstarted site in March, by the beginning of December the developer had already successfully sold RMB1.5 billion (US$246 million) in homes. In a development which had not yet broken ground.
More Overseas Projects in the Pipeline
Besides its Sydney project, last week Greenland agreed to pay US$984 million for the historic Ram brewery site in London, while picking up another $900 million property along the city’s Canary Wharf during the same week.
During 2013, the company was among China’s most aggressive acquirers of overseas projects, grabbing the US$1 billion Metropolis site in Los Angeles during July, soon followed by the US$4 billion Atlantic Yards project in Brooklyn and a Melbourne site during October, and a South Korea hotel project during December.
Thanks perhaps in part to these overseas sales, Greenland is planning on revenues of 400 billion yuan ($66.2 billion) in 2o14 according to the most recent statement from the company.
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