Reuters News - SOHO China to look beyond Beijing property - CEO

BEIJING, Nov 7 (Reuters) - Development beyond Beijing is inevitable for Chinese property firm SOHO China Ltd but the bulk of its business will remain in China s capital, the firm s chief executive said on Wednesday.

SOHO would also be eager to list in Shanghai after its $1.65 billion IPO in Hong Kong last month and is watching regulatory developments to see when that might be permitted, Zhang Xin told reporters at a financial forum in Beijing.

"Over the long term it s inevitable we ll go to other cities," she said. "But for the next three years, we still see Beijing as the main focus."

Zhang, one half of the husband-and-wife team that runs SOHO, said governments across China had invited its business after the flotation but nowhere attracted it as much as Beijing.

"As people accumulate their cash from their businesses, whether it s a Shanxi coal mine owner or a Wenzhou manufacturer, they want to park some of that wealth in Beijing or Shanghai commercial properties," she said.

SOHO this week bought two Beijing properties, one commercial and one residential, for 2.44 billion yuan ($327.9 million), and it already owns 20 percent of buildings in the city s Central Business District.

Zhang said commercial property development would remain the thrust of its strategy because of its high margins.

"The government s continuous tightening measures coming out on residential are not helping that business, not helping the margins," she said.

With China fretting over soaring real estate prices, it has used a raft of policies to calm the residential market but has been more hands-off on the commercial sector.

SOHO is currently prevented by Chinese securities regulation from floating shares in Shanghai as a "red-chip" firm incorporated and listed in Hong Kong but controlled by Chinese shareholders.

Zhang said raising funds on Shanghai would prove attractive if the rules change, something that the government is reportedly considering.

"We would love to look at that opportunity. It makes sense for us because we are a Chinese company and our brand name is recognised nationwide," she said." (Reporting by Simon Rabinovitch; Editing by Louise Ireland)