China Vanke Co., the biggest developer listed on Chinese exchanges, is expanding outside its home country because of rising housing demand in the U.S. and Canada and a wave of emigration, Chairman Wang Shi said.
“There are still opportunities in North America,” Wang said today at the China Business Conference at Columbia University in New York. Also, “we follow Vanke’s customers. Many of Vanke’s customers have emigrated abroad. About 30 percent of them have chosen America as the destination.”
Vanke and Tishman Speyer Properties LP, the owner of New York’s Rockefeller Center, signed a deal in February to develop two residential towers in San Francisco that will cost $620 million and have 655 units.
Chinese developers are starting to take advantage of demand for real estate around the world from Chinese nationals as the government imposes property curbs at home. Xinyuan Real Estate Co. in September took control of a lot slated for more than 200 units of housing near New York’s Brooklyn waterfront for $54.2 million, a deal the Beijing-based company said was the first of its kind by a Chinese firm in the U.S.
Vanke, based in Shenzhen, is expanding overseas as residential prices soar in China. The country’s new-home prices posted the largest gain in more than two years in March, according to SouFun Holdings Ltd., the country’s biggest real estate website owner.
About 35 cities issued property curbs by an April 1 deadline. Beijing banned single-person households from buying more than one residence, while Shanghai prohibited banks from giving credit to third-home buyers, the local governments said over the weekend.
The measures come a month after former Premier Wen Jiabao ordered the central bank during his last days in office to raise down-payment requirements for second mortgages in cities with excessive property gains and told local governments with the biggest price pressures to tighten home-purchase limits.
“The new policy not only confused foreign investors, but also confused me,” Wang said today. “They can not only use temporary controls on prices,” but also should limit increases “through the market.”
Wang today reiterated his view that there’s a bubble in the Chinese property market, which he had said last month in an interview on CBS Corp.’s “60 Minutes” news program.
The developer’s net income rose 30 percent to 12.55 billion yuan ($2 billion) in the 12 months through Dec. 31 as it sold more small and medium-sized homes that are less affected by government curbs, Vanke said in February.