Money
World's tallest building awaits local buyers
By Cui Haipei (China Daily)
Updated: 2010-04-30 07:54
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An auction house is banking on Chinese investors to pay towering prices for space in the world's tallest building.
Three properties in the Dubai structure, the Burj Khalifa, will be auctioned in Beijing in early June at a starting price of 70,000 yuan per sq m.
The auctions - for a single 50 sq m apartment, 16 apartment units as big as 2,000 sq m each, and an entire floor of commercial space - will be a first for the Burj Khalifa, according to the Beijing Yihai Auction Co Ltd. The auction house was commissioned by three individual owners from Hong Kong, the US and the United Arab Emirates.
The properties are expected to fetch from 4 million to 146 million yuan.
The once high-flying Dubai real estate industry has been pummeled by the international financial crisis.
"Property prices in the Burj Khalifa tower have been halved from more than 200,000 yuan per sq m down to 100,000 per sq m, on average," said Zhao Xiaokai, auction chief planner.
Facing slumping real estate prices in Dubai, owners are willing to sell their properties for lower prices, Zhao said.
"They hope to attract more Chinese investors by adopting a low starting price," Zhao said.
Property developers in Dubai are optimistic about Chinese investment in the emirate because of the strong consumer ability here, Zhao said.
"There are many Chinese visiting Dubai, especially during Spring Festival, and they have shown an enormous affinity for luxury goods," Zhao said.
Also there is a lot of hot money in China, Zhao said.
"Recently, several policies have been introduced to the domestic real estate market, causing a large withdrawal of funds from the property market here," Zhao said. "And hot money needs to be invested in other places."
The news of the auction was released on Saturday and already has had some effects on China's investors.
"We have received five calls from all over the country from prospective buyers," he said. The auction house is optimistic the parcels will fetch big prices.
