The real estate market in China will not collapse, as prices are supported by rapid economic growth, although the hotel segment could be at risk of a potential bubble, according to Ambrish Baisiwala, Chief Executive of Portman Holdings.
“Overall, we don’t see a bubble in China. But there are, of course, pockets of assets across specific cities where there may be an oversupply. We very much intend to quicken our pace in China,” he said.
Mr. Baisiwala revealed that Portman Holdings has plans to expand in China, citing cities like Beijing, Shanghai, Xi’an, Wuhan and Nanjing as its market prospects.
The company’s ambition to expand in China highlights the difficulties Beijing faces in cooling the hot real estate market, where months of official measures have not changed the mood among developers and investors, as witnessed at a property conference in Beijing last week.
Most of the attendees at the conference were confident that China can sustain its strong economic growth of around nine percent over the next five years.
Mr. Baisiwala believes there may be a bubble in China’s hotel industry because authorities are intensifying an oversupply in the segment by encouraging builders to develop even more.
He added that the overall rapid growth in the real estate market has produced some waste. Some new commercial and residential buildings have to be re-renovated, re-designed or sold at discounted prices, due to sloppy construction.
Operating in China since 1978, Portman Holdings is involved in designing, construction and management of an array of buildings, such as residential and commercial blocks and hotels.
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