Report says China's construction market is holding up well but regulation is a growing problem

Increased market regulation is posing a new risk to foreign investors in China, according to a new report into the state of Asian property markets.

The 2008 Asia Pacific Investment Report, from consultant Cushman & Wakefield, says the country remains 鈥渞elatively unaffected鈥� by the global downturn, with 2.4bn m2 of residential space under construction.

However, while market transparency is improving, an increase in regulation over the past 12 months has become a new problem for foreign investors, it says.

The report describes a 鈥渓ack of clarity鈥� about how existing regulations - such as the requirement to invest through an onshore wholly owned foreign enterprise - are implemented and concerns about potential future regulation.

The report, which covers 14 countries, including Australia, India, Malaysia, Pakistan, Thailand and Vietnam, was released ahead of property fair MIPIM Asia, which takes place in Hong Kong on 19-21 November.

Other findings included an expectation that 10,000 new hotel rooms will be built in Singapore between 2008 and 2011. Meanwhile, demand for commercial property in South Korea will continue strongly until at least 2010, driven by a lack of supply.

A full copy of the report can be found at www.mipimasia.com.

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