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Dan White Returns From China Investor Trip

By Phillip Lee

In late August four Ray White Group executives travelled to four major cities in China, to visit Ray White offices in Hong Kong and Beijing, meet their Chinese clients and present new Australian investment opportunities. The combined group provides broad real estate solutions to Chinese companies including development site acquisition, project design, project sales and marketing, and hotel investment.

Ray White Group Director Dan White was joined by Ray White Hotels Director, Andrew Jolliffe, Ray White Projects Director, Peter Walsh and Ray White Commercial Associate Director, Scott Timbrell. The group visited four main cities in China; Hong Kong, Shenzen, Shanghai and Beijing, with Andrew continuing on to Singapore.

The group met with 23 real estate and tourism investment companies, and three Australian Government trade officers.

Over 65 percent of these companies currently invest in Australia, with the balance of companies currently considering investing in Australia. Many of the companies that do invest in Australia, also invest in other ‘world cities’ including London, Paris and New York.

According to Dan White, many of these investors are companies which are responsible for some of the largest projects in Sydney. “They are currently undertaking $3bn of property investment and development in Australia alone,” said Dan. “And largely in Sydney, as it is seen as Australia’s leading world city, so it fits in with their global strategy.”

“Those we met indicated they were experiencing moderate conditions in their local markets. All were interested in new investment opportunities from our markets, as well as continuing with development plans for their existing investments here,” said Dan.

While all companies visited by the Ray White group said that the recent stock market volatility in China was not of itself deterring any of the companies from investing further in Australia. Further to this, when asked, no group was interested in selling any of their existing investments in Australia.

Simon Henry, co­CEO of Juwai.com, said Juwai’s research showed a similar outlook.

“We have checked the data many times since the stock market began its gyrations in China, and we see no impact on demand for international property. Nor did we see any as the stock market soared,” said Simon.

“As far as international property investment by Chinese goes, the stockmarket rise and fall has been a non­event. We expect demand for international property by Chinese investors to continue to increase over the coming decade, independent of what happens in the equities markets.”

Residential development sites remain of most interest, though there was an increasing interest in institutional grade income­producing assets from the larger pension funds.

“There is a strong feeling that the falling Australian dollar provided reason to invest further in Australia,” said Andrew Jolliffe. “Both in terms of relative value, and the potential for it to help increase domestic and international tourism and therefore returns in the hotel and tourism sector.”

Simon added Juwai’s research indicated the falling Australian dollar is doing just what it should by attracting new investment to Australia just as the rest of the economy slows.

“At Juwai.com, we see Chinese and southeast Asian developers and investors increasing their demand for medium and large commercial assets in Australia,” he said adding that the Juwai.com commercial Purchasing Intent Index for Australia has trended upward over the past year.

“This indicates the continuing attractiveness of these assets. July is down from the June peak, but we don’t believe that is significant,” he said.

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