Morgan Stanley Purchases Property Abroad

Posted on September 22, 2005 , filed under Business Gossip, Stocks | Print This Post

A trusted source that works for a government sponsored Shanghai Investment Company, tells me that Morgan Stanley is busy buying property in Shanghai. The interesting thing about Morgan Stanley purchasing property is that Morgan Stanley is advising its customers not to buy property from Shanghai citing over inflated prices. Meanwhile Morgan Stanley is busy investing in property development projects.

I believe the reason for the companies opposite messages is that following the .com bust, financial companies have come under increased pressure to separate their research and investment arms.

So while Morgan Stanley’s research arm is telling its customers not to buy Shanghai Property, Morgan Stanley is busy investing in Shanghai property. The prices in Shanghai have shot-up as much as 400% in some new commercial and residential developments over the last 5 years.

Relatively speaking Shanghai property is priced cheaply compared to other major international cities like Manhattan and Tokyo. The price per sq./ft is hovering around $500USD for prime residential property. Compared to other heated markets such as Dublin in Ireland, where a 10ft shed recently sold for $269,000, Germany’s residential market or Florida’s real estate boom, the rise in Shanghai’s prices seem timid. I believe the downside risk in Shanghai’s market is less substantial than other heated markets due to the relative low price.

Add this post to your favorite social networking site