Developers restructure for changing market

China's large and medium-sized property developers are restructuring their business by diversifying their activities or geographic presence to deal with the latest round of policy tightening.

Hong Kong-listed property developer Beijing Capital Land Ltd has quickened its step in building outlet complexes - projects integrating the residential, commercial, industrial and tourism sectors - as part of efforts to diversify its business.

In its 2012 annual report, Beijing Capital Land said the company will further promote business restructuring featuring the construction of residential and outlet complexes.

"We will push for a new business mode combining residential projects and outlet complexes and run trials in residential plus tourism and residential plus education projects to meet diversified customer needs," said Tang Jun, president of Beijing Capital Land.

The company has set up a team of 300 staff committed to the development of complexes in Beijing. The company currently has outlet complex projects in Beijing, Huzhou in Zhejiang province, Wanning in Hainan province, and Kunshan in Jiangsu province, and it plans to build them in more second-tier cities. Covering an area of more than 100,000 square meters, its Beijing outlet complex will begin trial operations in May.

Beijing Capital Land will strengthen its presence in mature markets, such as Beijing, Tianjin, Chengdu and Shenyang, according to its annual report.

Zhu Can, vice-president of Hongkun Properties Group, said the company will increase the proportion of its commercial properties and industrial parks in the coming three years.

The company has launched a luxury project in Beijing's central business district, with a unit sales price of around 80,000 yuan ($12,880) per square meter. And it plans to launch another villa project along Beijing's southern Fourth Ring Road in April.

A senior manager from Financial Street Holdings Co Ltd said the latest round of tightening measures had a very limited impact on the company, as around half of its business now comes from the commercial sector, primarily offices and retail.