One property tycoon, Vincent Lo, has spent $700 million in the past year acquiring at least a dozen big real estate projects left unfinished by cash strapped developers in China.
Vincent Lo, whose latest investment company is China Central Properties, said, ‘Last year, when the market was hot, everyone thought they could make a pot of gold. But this year, they see that isn’t true. This shaking out is going to move the industry in the right direction.’
In part the slowdown is the result of Beijing’s efforts to rein in rapid growth.
China’s estimated 50,000 small developers who borrowed heavily last year to buy land are now suffering financial problems and unable to borrow enough to keep going. A growing number are either folding or seeking aid.