CapitaLand, Southeast Asia’s largest developer, and China’s Longfor Properties Co. may raise a combined $3 billion in share sales that will test demand for Asian property stocks.

CapitaLand wants to raise up to $2.78 billion from the listing of its CapitaMalls Asia unit in what could be Singapore’s largest initial public offering since 1993. Chongqing-based Longfor, the biggest developer in China’s most populous municipality, may get as much as HK$7.1 billion ($1.3 billion) in a Hong Kong sale.

The amount sought would almost double the US$3.2 billion ($4.5 billion) raised by 10 real estate-related IPOs in Asia-Pacific so far this year. The two companies will be competing for investor funds against five Chinese developers that started marketing Hong Kong offerings last month.

“People have been waiting a long time to tap the markets for cash,” said Andrew Sullivan, a sales trader at Mainfirst Securities Hong Kong Ltd. in Hong Kong. “With the markets trading around year-to-date highs, they are keen to lock in the money in case the bubble bursts.”

The 168-member Bloomberg Asia Pacific Real Estate Index has jumped 59% this year, double the benchmark MSCI Asia Pacific Index’s 29% rise.

CapitaMalls and Longfor are taking advantage of a rebound in Asian economic growth, led by a US$585 billion stimulus package in China, the world’s third-largest economy. Singapore raised its 2009 economic forecast last month after gross domestic product expanded for a second consecutive quarter in the three months through September.

CapitaMalls
CapitaLand is offering about 1.165 billion shares in CapitaMalls at $1.98 to $2.39 apiece, according to e-mails sent to investors by sale arrangers Credit Suisse Group AG and Deutsche Bank AG.

The share sale will allow CapitaMall Asia to undertake expansion plans, including the acquisition of land for new developments and the purchase of completed malls, it said last month when it announced the IPO.

The listing of CapitaMalls Asia will give investors access to a company that manages 86 retail properties across Asia, including China. The company’s net asset value is estimated at about $5.3 billion as of Sept 30, according to a prospectus filed with Singapore’s central bank today.

If it’s priced at the top end of the range, the share sale may be the largest IPO in the city-state since Singapore Telecommunications’ initial offering in 1993, which raised more than $4 billion, a record for the island.

CapitaLand’s CapitaLand Retail unit reported a sixfold gain in profit last month as revenue from its China and Malaysia malls increased.