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CapitaLand buys retail outlets in
Beijing
BEIJING -
Singapore-based CapitaLand, a leading property
company in Asia, has acquired two large stores in
Beijing. The move is part of the company's aim to
form its proposed China retail property fund with
listing potential.
CapitaLand Retail
China Pte Ltd, a solely owned subsidiary of
CapitaLand Ltd, one of Asia's largest listing
companies, signed a cooperative agreement this week
with Beijing Hualian Group Investment Holding Co
Ltd to obtain two of Hualian's outlets in the
capital city, namely its Anzhen and Wangjing
stores, for 1.746 billion yuan (US$210.36
million). The two stores will be wholly owned by
CapitaLand Retail China.
Under the same
agreement, a 50-50 retail management joint venture
will also be established with Beijing Hualian to
provide marketing and retail management services
for the under-construction Wangjing store as well
as other properties that CapitaLand Retail China
may acquire in the future.
As one of
the largest chain retailers in China, Beijing
Hualian, with two listed subsidiaries on the Shenzhen
and Shanghai stock exchanges, has a portfolio of
68 outlets comprising department stores,
shopping malls and hypermarts spanning 35 cities in more than 23
provinces in China.
Its Anzhen and
Wangjing stores are both located in densely
populated areas, and their combined business area
is up to 130,000 square meters.
Anzhen has
been performing well in consecutive years and
Wangjing is expected to commence business by the
end of this year.
"This partnership
provides us with a head start in the retail
business in Beijing and north China, and the
outlook for our cooperation is rather positive,"
said Liew Mun Leong, president of CapitaLand
Group.
Echoing Leong's remark, Ji Xiao'an,
chairman of Beijing Hualian, indicated that his
company had performed strongly and successfully in
northern China and had aggressive expansion plans.
"CapitaLand provides an international
dimension in retail property management for us,
which may bring strong synergistic value to the
joint venture," said Ji.
Fan Yanru, deputy
secretary general of the retail enterprise's
committee of the China Commerce Association for
General Merchandise, told China Daily that the
cooperation might be regarded as a win-win
strategy, considering the widely recognized brand
of Hualian on the Chinese mainland and
CapitaLand's rich experience in retail property
management.
Earlier, CapitaLand entered
into a cooperative contract with state-owned
Shenzhen International Trust & Investment Co
Ltd (SZTIC) to acquire and manage a series of
shopping malls anchored by Wal-Mart, the world's
top retailer.
The total asset value of the
two Hualian outlets and the six properties jointly
invested in with SZTIC will amount to more than 3.689
billion yuan ($444.45 million).
"The two
acquisitions, and more acquisitions in the
pipeline we are pursuing, will expedite our plans
to establish a China retail property fund," said
Leong.
The Anzhen store is currently
generating a property yield of 8%. For its
Wangjing store, Beijing Hualian has guaranteed a
minimum net property yield of at least that much.
"They both provide the necessary returns
and match the investment profile required for the
proposed China retail property fund," said Leong.
Over the past few years, CapitaLand has
been active in the property fund business. With
the joint venture with Beijing Hualian, the group
is well on its way to more than doubling its
assets under management to 65.79 billion yuan
($7.93 billion) in the next three years, up from
the current 30.46 billion yuan ($3.67 billion).
(Asia Pulse/XIC) |
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