Though top-tier cities such as Beijing, Shanghai, and Guangzhou are well known to most investment professionals today, many other large, lesser-known Chinese cities offer considerable investment opportunities. To address some of the knowledge gaps, the Urban Land Institute Mainland China Cities Survey 2011 was undertaken as a pilot study by ULI Asia Pacific and the ULI Center for Capital Markets and Real Estate and now became one of the key annual initiatives.

The impetus for the original survey in 2011 was ULI Asia’s recognition that ULI’s scope in China must expand beyond the first-tier cities to include second and third-tier cities. This survey serves as a vehicle to both engage the real estate industry throughout China in a meaningful exchange of information and strengthen ULI’s relationship with the industry. The process furthers ULI’s primary values of leadership, engagement, and sharing of lessons learned.

The summary report, entitled “Urban Land Institute Mainland China Cities Survey 2012” will be launched at the upcoming 2012 ULI Asia Pacific Summit in May in Beijing. The report will be made available at ULI events at which the contents are the focal point, at other ULI-sponsored events in Asia, and on the ULI web site.

The Survey Methodology

The survey was carried out in two ways—an electronic survey and one-on-one interviews.

The electronic survey, in both Mandarin and English, was sent out to an extensive list of experts. This includes developers, investors, fund managers, property companies, lenders, brokers, and advisers. The survey questions focus on the relative overall investment and development prospects of about 28 cities, and on prospects by sector within each city. Initial questions explore the participants’ assessment of the impact of current economic and regulatory changes, to provide the appropriate context for interpreting survey responses. The final questions focus on emerging or niche markets.

The primary outcome of the survey is the ranking of the 28 cities and the relative distribution of investment recommendations—buy, hold, and sell—by property sector in each city.

The one-on-one interviews provide the opportunity to explore all issues touched on in the electronic survey in an in-depth manner. They were done in confidence and quotes that may be used in the final report are not attributed by name. These exchanges will provide the details as to why the cities’ are ranked, and investment recommendations made, as they are in the electronic survey, as well as broaden the understanding of how businesses are reacting to, adjusting to, and thinking about current economic and regulatory changes. Around 30 to 40 interviews were equally distributed among domestic developers and investors, and foreign developers and investors.

Interviews were conducted by a core team made up of Ken Rhee, ULI Mainland China Chief Representative; Brandon Sedloff, ULI Asia Pacific, and; Andrew Ness, former CBRE Director of Research in China and consultant to ULI on this project.

The summary report will present and discuss the survey results, elaborating on the rankings and recommendations, economic and regulatory issues mentioned, and niche markets notes.

Anita Kramer, Vice President of the ULI Center for Capital Markets and Real Estate, is the technical writer, focused on the results of the survey, and Andrew Ness contributes his decades-long expertise in the China real estate industry to broaden and deepen the discussion of findings from the survey and interviews.