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SOHO buys project for US$340m
By Cherry Cao |
April 18, 2012, Wednesday
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Print Edition
Print Edition
SOHO China, the biggest developer in Beijing's central business district, has agreed to acquire a mixed-used project in west Shanghai's Changning District from two other domestic counterparts.
SOHO will pay nearly 2.14 billion yuan (US$340 million) for the Tianshan Road project, which is 70 percent held by Greentown China Holdings Ltd, and 30 percent owned by Maanshan Development, according to statements filed separately by SOHO and Greentown to the Hong Kong stock exchange yesterday.
With a total built-up area of more than 172,200 square meters, the project will consist of high-end offices, retail and a five-star hotel to be managed under the Hyatt brand.
Beijing-based SOHO said the deal will allow it to seal its 11th project in Shanghai, which it first tapped in August 2009, to boost its commercial real estate portfolio while Greentown, the largest property developer in Zhejiang Province, said it will improve its cash flow.
Lower property prices and sales volumes - the consequences of restrictive regulatory policies - are hurting profit margins and cash flow of developers, especially the smaller and regional companies which have neither the scale nor liquidity to ride out the slowdown, Fitch Ratings said in a report yesterday.
With an investment of more than 25 billion yuan in Shanghai so far, SOHO remains upbeat over the city's office market amid robust demand and limited supply, Chairman Pan Shiyi said.
Shanghai's Grade A office rents rose to an average 7.60 yuan per square meter per day in the first quarter of this year, up a quarterly 2.7 percent, real estate services provider Savills said yesterday.
SOHO will pay nearly 2.14 billion yuan (US$340 million) for the Tianshan Road project, which is 70 percent held by Greentown China Holdings Ltd, and 30 percent owned by Maanshan Development, according to statements filed separately by SOHO and Greentown to the Hong Kong stock exchange yesterday.
With a total built-up area of more than 172,200 square meters, the project will consist of high-end offices, retail and a five-star hotel to be managed under the Hyatt brand.
Beijing-based SOHO said the deal will allow it to seal its 11th project in Shanghai, which it first tapped in August 2009, to boost its commercial real estate portfolio while Greentown, the largest property developer in Zhejiang Province, said it will improve its cash flow.
Lower property prices and sales volumes - the consequences of restrictive regulatory policies - are hurting profit margins and cash flow of developers, especially the smaller and regional companies which have neither the scale nor liquidity to ride out the slowdown, Fitch Ratings said in a report yesterday.
With an investment of more than 25 billion yuan in Shanghai so far, SOHO remains upbeat over the city's office market amid robust demand and limited supply, Chairman Pan Shiyi said.
Shanghai's Grade A office rents rose to an average 7.60 yuan per square meter per day in the first quarter of this year, up a quarterly 2.7 percent, real estate services provider Savills said yesterday.
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