A recent article in
bout Burger King Worldwide (
opening 1,000 new restaurants in China
offers a bullish insight into the future of the commercial
real estate market in the People's Republic.
Most attention on global real estate woes from the Great
Recession has focused on the housing market for private
residences, but the commercial sector has been pounded just as
hard, if not worse.
While the Internet has not harmed the housing market, it has
played havoc with the commercial real estate arena. For example,
Blockbuster has gone out of business due to movies being offered
over the Internet or delivered by mail. That does not happen with
That Burger King Worldwide is moving into China in such a
massive manner is bullish for the commercial real estate in the
country for a variety of factors.
The most obvious is that there will now be 1,000 pieces of
commercial real estate in China that will have a Burger King
restaurant as a new tenant. The commercial real estate market in
China can only benefit from that development.
The second bullish factor is that Burger King Worldwide is
optimistic enough about China's future to open 1,000 new
franchises. There is a great debate going on now about whether of
not China will have a 'hard' landing or a 'soft' landing for its
economy. Burger King Worldwide has obviously made its own
decision and is moving forward to implement it with the opening
of 1,000 new franchises.
Also of significance is that Beijing is welcoming new
businesses into the country. That will only increase the demand
for both residential and commercial real estate in China. This
new demand from foreign investors, by the basic laws of supply
and demand, will raise property prices in China both in the
commercial real estate sector and market for
homes in the People's Republic