US private equity firm Blackstone Group has committed to invest in China’s booming housing market, according to a report in the Financial Times.
Blackstone is backing Hong Kong developer Great Eagle’s construction of more than 1,000 luxury units in the city of Dalian, dubbed the Hong Kong of northern China. The development will include 400 hotel rooms, which will be built in stages.
This is Blackstone’s first significant investment in the housing market in China.
The Financial Times said Blackstone did not reveal the exact amount of investment it is pouring into the development, but its investment comes amidst the unprecedented rise in China’s housing prices, leading to a possible property bubble, as well as the recent implementation of government cooling measures.
Some analysts see Blackstone’s investment as part of the company’s move to focus on developing economies, especially China and India. Blackstone said that China’s significant growth and low valuations offer a good opportunity for positive results, with urbanisation and wage growth supporting values.