Most of the investors (in the industrial real estate market) and facilities are currently clustered in the country's eastern and coastal areas, Ng said. "But about 800 million people are living in China's vast central and western region where such logistics infrastructure is to be improved, which points to huge potential in this market," he said. In particular, China's logistics market, which includes freight, warehousing and distribution facilities, is set to grow massively in the coming years, driven by dynamic retail activities, analysts at the conference said.

China's logistics market is expected to grow by almost 30 percent a year in the next three to four years, according to Trent Iliffe, director of global real estate money management and services firm Jones Lang LaSalle's Industrial Property team in China. The booming manufacturing and retail sectors, Iliffe said, would serve as major engines for the expansion of the logistics industry in China. But he said the retail sector would be the biggest driver of logistics expansion. The number of foreign retailers in China has more than tripled from 314 in 2004 to 1,000 by the end of 2006, according to Iliffe.

At the same time, retailers such as Wal-Mart, BestBuy and B&Q have all set ambitious expansion goals in ChinaDate: March 28, 2007