Investors are keen to participate in off plan property China's real estate boom. In the second part of the interview Arjuna Mahendran, Head Research Asia Pacific Credit Suisse, looks at the influence the Olympic Games 2008 in Peking exert on China's current real estate markets and on some of the consequences of China's communist past. 
 
Olivia Schiffmann: Only 15 years ago there were few high-rise buildings in Shanghai. Since then, 554 have been built. Other cities are also in the middle of a construction boom. What would you say to potential investors who are afraid that excessive building activity could lead to a collapse in the market?
Arjuna Mahendran: Asian and Chinese regulators have shown a pro-active ability to anticipate incipient property bubbles since the lessons learnt in the 1997 Asian economic crisis. And stock market investors are now more keenly aware of the merits of attaching fair values when they assess the potential for property stocks and projects. So there is an in-built mechanism to prevent excessive valuations from building up. The 1997 crisis was caused mainly by capital flight from the Asian region as western financial institutions called in their loans to over-stretched property and infrastructure companies. Now, regulators are ensuring that the extent of leverage is contained.