Chengdu, Wuhan, Xi'an and Changsa lead the gaggle of non-coastal cities that will attract investors, according to ULI.
The Urban Land Institute, a global non-profit, gauged 26 of China's largest hubs for their potential for real estate investment. The top ranked city for investment possibilities was Chengdu, followed by Shanghai, Hangzhou, Wuhan and Shenzhen.
Chengdu also scored the highest ranking for development potential, reflecting its appeal to corporations seeking to relocate operations from more expensive coastal sites, says the report entitled "Mainland China Real Estate Markets 2012: ULI Analysis of City Investment Prospects"
Unlike some of the other major coastal markets, Shanghai and Shenzhen continue to draw investors because they are perceived as offering a high quality of life, the report says.
“In their assessment of cities’ prospects, respondents clearly took into account the quality of life the cities provide. In an increasingly competitive labor market, with cities jockeying for position with respect to being able to recruit talent, a city’s ability to retain graduates from local universities is critical to its overall industrial competitiveness,” the report says.
It points to the inland city of Hangzhou as drawing investors with its beauty and its lakefront location, giving it an advantage over cities that are perceived as having persistent environmental problems.
In general, the report notes, inland markets have become increasingly competitive due to a policy shift by China’s central government that over the past decade directed investment away from coastal hubs and toward the less-developed interior. In addition, as more inland markets have become hubs for information technology, they are much better positioned as employment centers that appeal to young, well-educated talented workers, it notes.
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