Two property developers based in southern China plan to list in Hong Kong next year, underscoring the continuing appetite for development capital to take advantage of the mainland’s surging real estate sector.

Hengda Real Estate Group, based in Guangzhou, has hired Goldman Sachs, Merrill Lynch and Credit Suisse to manage an initial public offering expected to raise about $1.5bn, according to people familiar with the matter. The investment banks declined to comment.