DALIAN, China -- A 56-story luxury condominium on the banks of the River Thames in London is drawing strong interest from Chinese investors.
"One Nine Elms", by Dalian Wanda Group, China's largest commercial property company, is the conglomerate's first development in London. It includes two buildings. The 200 meter-high City Tower will be the tallest residential building in central London once it is completed in 2018.
Apartments are now on sale with prices ranging from 795,000 pounds ($1.26 million) for a one-bedroom unit to 2.5 million pounds for three bedrooms.
Wanda first sold the apartments exclusively in London in late October. They later expanded sales to China, Singapore and Hong Kong. Wanda's Deputy General Manager of international real estate Michael Purefoy said "the majority of buyers are U.K.-based and familiar with the London market." He also said the response from China had been impressive. Thirty-three out of the 66 units offered there sold in a week.
Wanda has been promoting its London development at its hotels across China. Brochures try to attract potential buyers with talk of the constant rise of London property prices, as well as photos of the nearby Palace of Westminster.
However, Wanda's interests are not just limited to London. Earlier this year, it bought the Edificio Espana, a historic skyscraper in the heart of Madrid, for 265 million euros ($332 million) from Spanish banking group Santander. The Neo-Baroque building, which was completed in 1953, has been empty for several years. Wanda is expected to turn some of the floors into apartments, along with a hotel and offices.
According to U.S. real estate company Colliers International, the total value of investment in overseas property from China grew to more than $16 billion last year from about $69 million in 2008 -- a two-hundredfold increase.
Living in a foreign capital is the trendy thing among wealthy Chinese these days. A state-owned real estate company based in Shanghai, Greenland Holdings Group, is converting Britain's oldest brewery, Ram Brewery in west London, into a 36-story apartment complex.
Chinese companies are also snapping up prime real estate in the U.S.
Beijing-based Anbang Insurance recently bought the iconic Waldorf Astoria New York hotel, which it is expected to convert part of into luxury residences.
"It is a challenge to operate a luxury hotel with 1,413 rooms. There are tremendous opportunities to increase value by significantly reducing the size of the hotel and create luxury residences as well as high-end retail on the ground floor," said Daniel Lesser, president and CEO of New York-based real estate consultant LW Hospitality Advisors.
Lesser points to the transformation of The Plaza in New York by Israeli company El Ad Properties as an example. "The Plaza previously housed 805 rooms and today includes 282 hotel rooms, and 182 residential condominiums that sold for about $1.5 billion," he said.
The Chinese appetite for prime real estate is changing the way a city looks. "In central London, 200-year-old Georgian townhouses, that were originally homes and then converted into commercial spaces, are now reverting back to residential use," said Mark Farmer, head of residential at EC Harris, a property consultancy.
Former industrial buildings such as Battersea Power Station, Lots Road Power Station and the Shell Center, all in London, are also being converted into residences. "In many instances these properties will be heavily marketed in Asia," said Farmer.