China Real Estate Report

Published 10 August 2015

  • 51 pages
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$1,295.00
China Real Estate Report

BMI View:   Although we see Chinese economic growth slowing in the medium term, we are optimistic for the commercial property sector as a whole, as the maturing of the Chinese economy means that opportunities for new, premium developments remain plentiful. Reflecting this view, there is significant international interest in investing in Chinese commercial property.

We forecast a slowdown in Chinese economic growth, despite government stimulus measures, from 6.7% in 2015 and to under 6% by the end of our forecast period, in 2018. The government is treading a fine line between continuing with policies to stimulate investment with badly needed market reforms. The market is also being hit by a fall in residential real estate prices, with many predicting that the Chinese property bubble will burst. We do see prices continuing to fall, although in our view this will be more a correction than a crash, but it will undoubtedly have an impact on sentiment in the economy as a whole. However, in general we are optimistic regarding the commercial real estate sector, as demand remains strong and opportunities are plentiful.

Demand in the office sector is set to remain strong, driven particularly by the premium property segment and services-related industries such as finance and IT, with interest coming both from local and international firms. Overall the supply/demand dynamic will remain balanced as a result of a pipeline of new projects opening, particularly of grade A space.

We see significant opportunities arising in the retail real estate sub-sector. As China's economy moves towards domestic consumption, we believe that significant opportunities will arise in retail, especially towards the premium end of the market in the mass grocery retail and clothing sectors in particular. If the economic slowdown has a more marked impact on household spending than we expect the sector could suffer, but in general we are optimistic, and see household spending rising significantly...

BMI Industry View
5
SWOT
7
Political
7
Economy
8
Operational Risk
9
Industry Forecast
11
Office - China - 2015
11
Table: Office Rental Rates
13
Table: China Yield Rates
14
Retail - China - 2015
15
Table: Retail Rental Rates
17
Table: Retail Yields
18
Industry Forecast
19
Table: Rental Rates
21
Residential/Non Residential Building - Outlook And Overview
23
Table: Residential and Non-Residential Building Industry Data (China 2013-2018)
23
Table: Residential and Non-Residential Building Industry Data (China 2019-2024)
23
Table: Major Projects Table - Residential/Non-Residential Construction and Social Infrastructure
28
Macroeconomic Forecasts
34
Economic Analysis
34
Industry Risk Reward Ratings
38
China - Risk/Reward Index
38
Market Overview
39
Competitive Landscape
41
Demographic Forecast
42
Table: Population Headline Indicators (China 1990-2025)
43
Table: Key Population Ratios (China 1990-2025)
43
Table: Urban/Rural Population & Life Expectancy (China 1990-2025)
44
Table: Population By Age Group (China 1990-2025)
44
Table: Population By Age Group % (China 1990-2025)
45
Methodology
47
Industry Forecast Methodology
47
Sources
48
Risk/Reward Index Methodology
49
Table: Real Estate Risk/Reward Index Indicators
50
Table: Weighting Of Indicators
51

The China Real Estate Report features BMI Research's market assessment and independent forecasts of major construction projects in the residential and commercial markets, plus rental prices and yields in major cities. The report critically analyses the prospects for real estate within the broader economic and financial context - both domestic and global - via our econometrically-modelled and clearly explained banking and economic forecasts and follows this through to evaluate the implications for REITs.

BMI's China Real Estate Report provides industry professionals and strategists, sector analysts, business investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the real estate industry in China.

Key Benefits

  • Benchmark BMI's independent real estate industry forecasts for China to test other views - a key input for successful budgeting and strategic business planning in the Chinese real estate market.
  • Target business opportunities and risks in China through our reviews of latest industry trends, regulatory changes and major deals, projects and investments.
  • Assess the activities, strategy and market position of your competitors, partners and clients via our company profiles (inc. SWOTs, KPIs and latest activity).

Coverage

BMI Industry View

Summary of BMI’s key industry forecasts, views and trend analysis covering real estate and construction, regulatory changes, major investments and projects and significant national and multinational company developments.

Industry SWOT Analysis

Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the real estate sector and within the broader political, financial, economic and business environment.

Industry Forecasts Outlook

Historic data series (2010-2013) and forecasts to end-2019 for the domestic real estate industry and for the local and global finance industry.

Indicators Include:

  • Real Estate: Office, retail and industrial real estate yields for all major cities (%); short term forecasts on minimum and maximum real estate rental prices by sub-sector (USD per square metre and local currency per square metre).
  • Construction: Industry value (USDbn); contribution to GDP (%); employment (‘000); real growth (%).
  • economy: Economic growth (%); nominal GDP (USDbn); unemployment (%); interest rates (%); exchange rate (against USD).

BMI’s Real Estate Risk Reward Index

BMI’s Risk Reward Indices provide investors (real estate vendors, construction companies and financial investors) looking for opportunities in the region with a clear country comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide an indices of highest to lowest appeal to investors, with each position explained.

Market Overview

Overview of the real estate sector, including analysis of existing/planned real estate developments and emerging industry trends in the office, industrial and commercial sectors

Market Analysis

Features detailed city-level data and analysis on rental prices, yields, contract terms and real estate availability with separate chapters covering the office, retail and industrial sub-sectors.

Company Profiles*

Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape to generate Company SWOT analyses. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.

*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.

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