China’s largest developer, Country Garden, has acquired a site for the development of 785 homes in east London for a reported £80 million.
The Guangdong based company has acquired the Ailsa Wharf site, which has been approved for the development of thirteen housing blocks ranging from three to 16 stories high, and valued at around £400 million.
The deal marks a rare acquisition by a Chinese mainland company and is an event that developers are watching closely, to see if it becomes a sustained trend. The British developers Galliard Homes and Lindhill, who spent five years acquiring the site, have lauded it as a "ringing endorsement for the UK to have Country Garden make a significant investment on residential development East London”.
A weak British pound has made London an attractive prospect for Chinese-based investors, not a view shared by other foreign investors who have erred on the side of caution when considering investment in the capital amidst Brexit uncertainty.
Country Garden have a large portfolio of overseas projects, currently spanning Australia, Malaysia, Thailand and Hong Kong. Although this is not Country Garden’s first operation in the UK market, it is certainly its largest, and the company will be keen to show they have learned lessons from their struggling $100 billion Forest City development in Malaysia.
Although London receives significant attention from foreign investors, Country Garden have also expressed an interest in other parts of the UK, such as Birmingham where they have committed to investments worth a reported £2 billion to the city’s economy.
With other mainland Chinese companies such as Greenland Group, and China Vanke investing in high value developments in London, the city’s skyline looks set to be shaped by another pair of hands.