But he explained that he didn't mean buyers of individual residential properties – the popular target of tabloid journalists, shock jocks and a House of Representatives economics committee inquiry.

What riled him were Chinese real estate investors on the larger scale. Turns out he meant the investors who are being given near-unfettered freedom to buy under the China-Australia free trade agreement.

Fairfax Media reports that new Foreign Investment Review Board rules mean that the FIRB screening level for Chinese investors buying commercial property will jump from $54 million to $1.078 billion. (And, no, I have no idea why it's not just a neat $1 billion.)

The local developer complained that Chinese investors were paying well above market prices for sites and then sitting on them in no apparent rush to develop. It's a complaint that has subsequently been confirmed in other industry conversations and put on the record by Lang Walker, CBUS and the head of the ANZ bank's head of commercial property.

Billionaire developer Walker said the logic behind the prices paid by Asian developers was questionable. "It is a little scary but at the end of the day I think it is just them getting money out of Asia as opposed to the fundamentals," he said.

"I do agree with the pundits that they are paying some big prices for sites but I think maybe their drivers are different to ours."

ANZ's Eddie Law said banks had to carefully monitor the logic of new offshore-backed site purchases: "Chinese equity competes in its own framework against local equity. It has a propensity to pay a higher price, particularly for development sites, and the jury is out as to the logic attached to that at the moment."

The original developer in this story provided a rough guide to how his business worked:

Given the cost of money, if he paid $X for a site, he needed to develop it within Y years and sell it for $Z a square metre to break even, let alone make a profit. He was coming up against foreign buyers prepared to pay double the X and then sit on the site for an indeterminate time. This meant the eventual break-even sale price would have to be a multiple of Z – a multiple he couldn't see the eventual market being able to afford.

It was considerations about the eventual price that led Lang Walker to get out of industrial property before the GFC storm hit. He found he was coming up against competition from buyers – "kids with a clipboard and open cheque book" - paying prices for sites that meant they could not be profitably developed.

So he sold out and consequently looked like a property genius when industrial property was smashed.

Michael Pascoe is a BusinessDay contributing editor.