[photopress:Shenyang_1.jpg,full,alignright]POLY Real Estate Group, China’s largest state-owned developer, has bought a plot of land for RMB358.26 million ($46 million) in the northeastern city of Shenyang in Liaoning Province to enlarge its land bank. The company said in a statement to the Shanghai Stock Exchange that it bought the 2.26 million-square-foot site at auction. Guangzhou-based Poly has purchased three sites in three months for RMB2.3 billion, raising its land reserve by 9.24 million square feet to 104.4 million square feet.
Poly and other large builders are betting that government measures aimed at cooling China’s real estate market will give them opportunities for expansion as smaller rivals are expelled. China’s fastest economic growth in more than a decade has boosted household incomes and spurred more people to buy homes.
Zhang Luan, an analyst at Haitong Securities Co in Shanghai, said, ‘Poly is a bit aggressive, expanding land reserve so fast. The company is taking advantage of the macro controls which have made small developers hesitant to buy land.’
The government imposed cooling measures on the residential property market on concern that prices and investment are rising too quickly, threatening excess capacity and causing an eventual collapse.
Meanwhile Poly Real Estate Group, which is China’s largest state-owned developer, plans to sell a 27 percent stake in an initial share sale in Shanghai to finance projects. Poly said in a filing to the Shanghai Stock Exchange that it has RMB8 billion(US$1 billion) in assets and will offer 150 million new local-currency shares.
China has ordered banks to restrict lending for real estate out of concern that investment and prices are rising too rapidly, prompting developers such as Shimao Property Holdings to raise funds by selling equity.
Source: Shanghai Daily