• W brand luxury in Guangzhou sets market ablaze

    28 March 2009

    In April KWG Property Holding (KWG) launched their latest development W Residences, which will be managed by W Hotel. Already this upscale apartment building is being hailed as Guangzhou’s most luxurious residential offering, which the developer likens in quality to Hong Kong’s Four Seasons serviced apartments. 

    The public seems to agree with this sentiment as on the first weekend alone 125 of the 337 units on offer were sold for an average price over HK$28,000 per square meter, netting KWG almost 250 million dollars.

    Units come in three sizes of 40, 80 or 120 square meters. W residences are located in Zhujiang New Town, which is being hailed as the new central business district of Guangzhou.

    To match the market buzz the development was launched with much fanfare with an uber-chic party featuring fashion, celebs and some of Hong Kong’s more famous catwalk models. 

    Colliers International in Guangzhou was appointed as sales agent for the W Residences – it is the first time that Colliers have entered the high-end residential market. “Luxury property in Guangzhou sells for only a fraction of the price it fetches in other mainland cities, such as Beijing and Shanghai. So it is attractive to buyers,” stated Eric Lam, general manager of Colliers International in Guangzhou. 

    He expects the project to appeal in particular to senior executives from Japan and South Korea because they enjoy the hustle and bustle of life in the city centre and have a greater purchasing power.

    Others expect there to be strong interest from the Pearl River’s own business elite and from foreigners who recognize the W brand. 

    In 2007 the provincial government restricted all non-Mainlaind residents, including those from Hong Kong, to purchasing one local unit only as a way of cooling speculation in the market. However this contributed to a 21 percent drop in home sales in 2008, the first decline since 2003 according to the Guangdong Real Estate Association. A new 15 point stimulus package removed these restrictions and also cuts taxes on purchases of new homes. 

    However the high end market is quite stable in Guangzhou due to a limited supply and recent moves by the provincial government to revive Guangdong’s ailing property sector would have less of an impact than supply and demand in the top tier stated Terry Chen, Director of KWG. “The financial crisis did not have any impact on our plan to launch this project. Demand for luxury properties is always there, no matter what the market situation is,” he said. 

    The developer reported that construction of the first phase of the development, which will provide approximately 245 villas and twin houses, is scheduled for completion by the middle of 2010. 

    Says Eric Lam, “Colliers International has been active in China property for 16 years, but KWG’s property is the first in Guangzhou to reach such a high standard, what the Americans refer to as 6 Star. I believe that W Residence will now be the benchmark for quality residential in Guangzhou, setting a milestone for an apartment block of such standards, which Guangzhou has never had before.”

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