Chinese Developer Eyes London as its Next Major Project
According to a recent report from Property Week, Chinese developer Country Garden is in the early stages of planning a huge building push across London. Spurred on by the uncertainty Brexit has induced, China’s third largest residential property developer has been lured by the chance of snapping up land at lower post-Brexit prices. They then aim to build many of the homes that are much needed in the capital, before selling them to investors and home-buyers, once they’re built in a calmer, post-Brexit economy.
“The uncertainty unleashed by Brexit, not just in London, but across the UK too, presents the perfect opportunity for the right developers,” said Newington Green estate agent, M&M Property. “Property and land values have taken a hit in the past year, but demand for property in London remains strong and is expected to grow as Brexit negotiations begin to reveal what the future holds for the capital.”
Major Development Anticipated
While the news is still being uncovered, it’s believed that Country Garden is investigating land deals including regeneration sites across London. And, the projects they’re considering are said to be on a larger scale than the 20,000 homes London Mayor Sadiq Khan has recently secured with L&Q Housing.
The Chinese developer has a history of completing major housing projects and if they do bring their experience and investment to London, it will surely be a very welcome move. Not only for those Londoners in need of somewhere to live, but for other investors and the Government too.
Investment on the scale being discussed would be a big boost to the jobs market and should also help focus infrastructure planning too – something that can be difficult when housing developments are needed but haven’t begun, due to non-committal investors and developers.
“If Country Garden can make a deal it’s happy with, then this won’t just be a golden opportunity for them, it will also prove positive for the UK economy,” said Plaza Estates. “The need for residential development in London is clear, provided it’s not all aimed at luxury buyers and will accommodate working Londoners, too.”
Chinese Investment on the Up
This news that Country Garden is considering a major investment in London’s residential housing stock is the latest in a string of deals made by other Chinese businesses, in the city. A Guangzhou-based business called R&F Properties has already purchased two London sites: the Nestle Tower and other sites in Croydon for £60 million and a development in Nine-Elms, called Vauxhall Square, for £157 million.
While a big part of the lure of London property investment is from the potential rewards at a time when property values in the capital have fallen, there are other reasons too. In particular, the weaker value of China’s own currency – the renminbi – is a significant driver of the investments.
“Property investment on this scale is rarely due to one single reason and in the case of increased interest from Chinese developers, it’s no different,” said Best Gapp. “Many developers see an opportunity to make money in London, while legitimately taking their sizeable funds out China, at the same time.”