Some 2,109 premium residences went on sale this week in the northern Chinese city of Dalian, catering to buoyant demand from a rising middle class.

More than 1,000km to the south, the bustling city of Ningbo is seeing construction of its first outlet mall, which will host 160 stores when it is completed in a few years' time.

The two large-scale projects are examples of countless residential and commercial sites springing up all over China, but with a notable difference: they are being built with the help of Japanese developers keen to tap the booming Chinese market.

The Dalian residential and commercial development is being built as a joint-venture between Daiwa House, an Osaka-based developer, and a Chinese partner. Mitsui Fudosan is jointly developing the shopping centre in Ningbo with two Chinese and two Japanese partners.

For the most part, Japanese developers have been relatively shy about venturing outside their home market but Daiwa House and Mitsui Fudosan are among a growing number that are making a push into China.

For Mitsui Fudosan – Japan's leading developer of shopping malls, which has been in the business for more than 30 years – the project is its first foray into the retail facility business outside its home country.

Daiwa House was a pioneer among Japanese developers in China, where it built its first residential units in 1985. But Hidero Eto, manager of global promotion, says overseas sales “are virtually invisible”.

Given the declining prospects for growth in Japan and the massive demand for housing and infrastructure in China, the lure of the Chinese market is proving irresistible to many Japanese developers.

Takehito Fukui, Mitsui Fudosan's project manager for the Ningbo shopping mall, says: “Consumption [in China] has been expanding at an eye-popping rate.”

As consumption is only about 30-40 per cent of gross domestic product in China, compared with 60 per cent in Japan and other developed economies, “there is still considerable room for consumption growth in China” to drive demand for shopping malls, he says.

Mr Eto points out that there are 200m households in China's cities alone, and in the 10 years to 2009 fewer than 80m housing units were supplied.

Consequently, demand for housing is still very strong. “Where is the bubble?” asks Mr Eto. People who say there is a bubble “must be crazy”, he adds.

Daiwa House recently completed another 852-unit residential project in Dalian and is working on a development in Suzhou that will comprise 902 residential units.

But growth is not all that makes China attractive. “Unlike Japan, where price competition is severe, the margins in China are much bigger,” Mr Eto says.

Although competition from local developers is strong, Japanese developers believe they can capitalise on their decades of experience as well as the reputation for quality work that Japanese companies enjoy.

For example, Mr Fukui says there are very few companies in China with expertise in handling shopping mall projects from start to finish, from developing and maintaining the overall site through to selecting the right tenants and knowing how to help tenants increase revenues.

Mitsui Fudosan believes its reputation among retailers in Japan, which it has built over decades, is another advantage.

“By encouraging Japanese tenants to open shop in China, we can differentiate ourselves from other developers,” Mr Fukui says.

Daiwa House is equally confident that it has an edge over local developers because “the quality of the work of Chinese builders is low”, says Mr Eto.

With all the work available in the current market, local developers have been too busy trying to learn from more experienced Japanese competitors, he points out.

But they are very smart. “If we don't watch out they will easily catch up,” Mr Eto says. “We always have to stay half a step ahead.”