US private equity (PE) fund Blackstone Group LP yesterday denied that it is retreating from the Chinese property market, after a fund it controls sold its stake in a real estate joint venture with a Chinese property developer.

"We are strong believers in the long-term growth prospects for the real estate market in China and will be looking for further such investment opportunities for our funds," Stuart Grant, senior managing director of Blackstone, told Reuters in a statement yesterday.

Grant's statement came after Evergrande Real Estate Group said Wednesday one of its subsidiaries had bought back a 40 percent stake in the Royal Scenic Peninsula housing development in Guangzhou, Guangdong Province for $161.6 million.

The sellers were MB Asia Real Estate Fund, run by Blackstone, which owned 69.2 percent of the stake, and hedge fund Elian Properties, which owned 30.8 percent.

The sellers made close to double their investments in the project, Reuters said.

Blackstone's latest move has increased market suspicions that the PE group is speeding up its retreat from China's property market.

In September, Blackstone sold its 95 percent holding in Shanghai's Channel One shopping mall to Hong Kong tycoon Cheng Yu-tung's New World Development Co and gained about 460 million yuan ($72.7 million), marking its first withdrawal from the market.

"For some overseas PE funds, you can't believe what they say. Instead you should pay attention to what they actually do," Zhang Dawei, an analyst at Centaline Property in Beijing, told the Global Times.

"Blackstone's move suggests it is bearish on short-term returns from China's commercial real estate market," he said. "The earlier it sells, the more it could gain."

Some experts said Blackstone's decision doesn't signal foreign investment is withdrawing from the market as a whole.

"Blackstone's decision is based on its business performance, and it might use the money gained from China to improve its cash flow," Li Zhanjun, a researcher with Shanghai-based E-house China R&D Institute, told the Global Times.

"Actually some Singapore and Hong Kong-based property companies such as CapitaLand and Hang Lung Properties bought land and properties in mainland cities in the past few months," he said.

Blackstone plans to invest 200 million yuan in a joint venture for domestic property development, with Hangzhou-based property developer Greentown China Holdings, a subsidiary of China Investment Corp, and Beijing Greentown Sunshine Investment Co, Caixin Century Weekly magazine reported in December.