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SOHO China to sell 2 Shanghai projects for 5.23b yuan

By Cherry Cao | February 28, 2014, Friday | Online Edition

SOHO China Ltd has agreed to sell two of its projects in Shanghai to Shenzhen-listed Financial Street Holding Co Ltd for 5.23 billion yuan (US$853 million).

The two projects, located in Jing'an and Hongkou districts, were both acquired by SOHO China in April 2011 when the Beijing developer paid a combined 4.1 billion yuan as it aggressively sought expansion in an area outside its home base.

“It remains our long-term strategy to hold high-quality assets in prime locations in Beijing and Shanghai, while we will keep optimizing our portfolio by unloading some of our projects which have comparatively less core locations,” said Pan Shiyi, chairman of SOHO China, in a statement released today.

“Meanwhile, we will continue to look for trophy assets and purchase them at appropriate times as we seek balanced operations in Beijing and Shanghai.”

In August 2012, SOHO China announced that it would shift its strategy from the “build and sell” model to “build and hold” as it expects promising growth in rent and the capital value of prime office buildings in Beijing and Shanghai.

And the “selling of the two projects is in line with the company's strategy to acquire more high-quality, Grade A office buildings in core locations in Beijing and Shanghai," according to the statement.

As of June 2013, SOHO China had five projects in Beijing and 11 projects in Shanghai, according to the company's 2013 interim report.

Acquisition of the two projects will help Financial Street Holding to further extend its domestic footprint and expand operations for future growth, the company said in a filing today with the Shenzhen Stock Exchange.
 

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