Shenzhen developers wins RMB 3.3 bln land auction in Tianjin

Two Shenzhen-based developers announced on Aug. 4 that they have won land auctions in the northeastern port city of Tianjin for a combined RMB 3.3 billion to cash in on the country's red-hot housing market, The Standard reported.

One of the properties, located next to Tianjin Binhai area with an area of 1.9 million square feet, was bought by Gemdale Corp at RMB 2.27 billion for developing residential and commercial projects.

Located in the juncture of the Beijing-Tianjin City Belt and the Circum-Bohai City Belt, Tianjin Binhai area is a development zone modeled on Shanghai Putong financial district.

Gemdale Corp<600383> is one of the largest property developers based in Shenzhen. Its 2006 revenues totaled RMB 3.6 billion, while annual earnings equaled RMB 0.64 per share. It has also set up a property development venture with the Ductch ING Real Estate earlier this year to co-develop a residential property project in Foshan, Guangdong.

Another 34,841-square-metre land was bought by Zhenye (Group) Co. Ltd<000006> at the price of RMB 1.06 billion for residential development.
Recently, an increasing number of developers have been shifting their focus to second-tier cities, which have rising real estate price fuelled by great housing demand there.

Hong Kong-listed Chinese company Guangzhou R&F Properties<2777> said last Friday it had bought a plot of land in the northern city of Taiyuan for RMB 680 million.

Poly Real Estate Group<600004>, a mid-sized developer affiliated with China's military-backed China Poly Group Corp, also announced last week it had signed deals to buy land in three Chinese cities for more than RMB 6.1 billion.

Shares of property developers are among the star performers in China's domestic A-share market this year, with shares in Gemdale and Poly Real Estate up 50 percent in the past month.