Wanda Group looks to the horizon

A man, who worked for one of Wanda's contractors on its plaza in Xi'an, Shaanxi province, said the workers built one floor every three days.

"Wanda set up a very tight schedule for the construction," said the man, who did not want to be named. "But if you manage to finish before deadline you get a big bonus."

In the case of the London hotel project, it took Wanda Group three months from becoming aware of the site, to doing the due diligence and buying the site from Green Property Ventures, a property development and investment company operating in core commercial sectors in Ireland and the UK.

Stephen Vemon, chairman of Green Property Ventures, who sold the site of the future Wanda Hotel London, said for such a large transaction the group was the best client his company had ever had.

"We found them very good to deal with. They were straightforward and they asked only the right questions," said Vemon, who refused to reveal the size of the deal with Wanda. He said his company approached Wanda in early March about the site because it was "much too big" for Green Property Ventures itself.

Wanda's luxury hotel, which will be the highest residential building in London and will feature a rooftop swimming pool, will be built in the city's Nine Elms regeneration site, which will also be home to new US and Dutch embassies.

"We've seen a surging number of Chinese companies investing in the UK," said Sebastian Wood, British ambassador to China. "As many as 500 Chinese companies operate in the UK. But in terms of their investment scale and future plans, Wanda Group is absolutely standing at the top."

Vemon said it makes sense for most international developers entering a new market to develop large projects.

"If you are building a long way from your home, it is going to take you a lot of resources to develop a project, whether it is big or small. It is more worthwhile to make it larger," he said.

Money does not seem to be a big problem for Wanda. Wang said that half the investment in the UK will come from his own company, the other half from banks. Though he did not reveal the details, senior executives from the Industrial and Commercial Bank of China, the Export-Import Bank of China and HSBC took part in Wanda's news conference last week.

However, whether Wanda can continue its success outside China is open to question. Liu Hui, chief consultant specializing in real estate with the Beijing Uni-Retail Business and Management Co Ltd, said that Chinese commercial real estate companies will not be ready for such expansion for about five to 10 years.

"The commercial property market in China is still in its infancy, compared with the market in the US and Europe," he said. "Buying a piece of land overseas cannot be interpreted as global expansion. It may be just a good investment."