GuocoLand (China) Limited, the China arm of the Singaporean real estate company, will pour over US$5 billion into China's property market this year.

The investment is nearly double GuocoLand's capital injection into the country over the past two decades.

"The move underlines our strong commitment to be a major player in China as well as our confidence in the growth of China's economy," said Violet Lee, managing director of GuocoLand China.

The expansion, Lee said, is partly because of the government's restraining policy on the sizzling property sector, which will cause difficulties for smaller developers but provide more opportunities to cash-rich companies.

Although the Ministry of Commerce has said it will adopt a more restrictive attitude toward foreign investment in property projects, Lee said it has a limited impact on long-term foreign investors. And, the company's accelerated expansion is an expression of this confidence.

GuocoLand China acquired a 100-percent stake in Tianjin Zhong Xin Ming Shi Real Estate Development Co from Lead Mix Limited and Reliapoint Limited, it said in a statement to the Singapore stock exchange yesterday.

The purchase cost GuocoLand China some 406 million yuan, which will be funded by its parent company's internal resources and loans.

Tianjin Zhong Xin Project Co holds the land-use and development rights to a land parcel known as Plot 12 located in the Laochengxiang area in the Nankai District of Tianjin.

Laochengxiang, the oldest residential district in Tianjin, is a cultural, commercial and historic hub.

The site, with an area of 26,000 square meters and a saleable area of about 153,000 square meters, is designated for residential and office development.

The acquisition marks GuocoLand's foray into Tianjin, a major city with a flourishing economy in northern China, and strengthens the company's presence in China, where it is active in Beijing, Shanghai and Nanjing.

"We plan to develop over 1 million square meters in the future, a tenfold increase on our current projects," said Lee.

GuocoLand China is also preparing to go to Chongqing and Chengdu this year. "We have been in discussions for several projects in those cities," Lee added.

But exploiting second-tier cities doesn't mean GuocoLand China will shift focus from key municipalities. "As the base for GuocoLand, we want Beijing to take 50 percent in our overall market share," said Lee.

The company has signed a conditional cooperation framework with Beijing Beida Jade Bird Company to take over a land parcel of 106,000 square meters. The site is located along the main thoroughfare of Dongzhimen Road on the east second ring road in the Dongcheng District of Beijing.

(China Daily March 28, 2007)