No property bubble in China but hotels at risk

BEIJING: China's exuberant property market will not collapse as prices are supported by brisk economic growth although there could be a bubble in the hotel sector, a United States property developer said.

Ambrish Baisiwala, chief executive of Portman Holdings, said he was bullish on China's commercial and residential properties even though some investors believe there was a real estate bubble in the world's second largest economy.

Baisiwala, who helped develop more than US$30bil worth of properties at struggling Abu Dhabi developer Aldar Properties before joining Portman in 2006, said the US firm would like to expand in China.

“Overall, we don't see a bubble in China. But there are of course pockets of assets across specific cities where there may be an oversupply,” he said. “We very much intend to quicken our pace in China.”

The company is now looking at China's top cities such as Beijing and Shanghai as well as secondary cities including Xi'an, Wuhan and Nanjing.

He did not say if Portman would expand in China organically or through acquisitions, and declined to give further details.

Portman's China ambitions underline the difficulties Beijing faces in cooling the red hot property market, where months of official clampdown has not dampened the mood among investors and developers, as seen at a real estate conference last week.

Many at the conference in Beijing were confident China can sustain its solid economic growth pace of about 9% over the next five years.

By Reuters