Metro targets HK buyers

PUBLISHED : Friday, 21 February, 1997, 12:00am
UPDATED : Friday, 21 February, 1997, 12:00am

Guangzhou Metro Corp is in talks with Hong Kong-listed property developers to sell the remaining four sites above its Metro Line One.

Vice-manager Wang Wenbin said the sale of the sites had been hit by China's sluggish property market.

It had sold 20 of 24 land lots above the metro line, running from Guangzhou East Railway Station to Fangcun Depot in the southwest, mostly to Hong Kong developers, for 2.1 billion yuan (about HK$1.95 billion).

The company initially expected to make 3.8 billion yuan by selling the 24 sites. It faces a shortfall of 1.7 billion yuan.

Mr Wang said this would be made up temporarily by the municipal government's income from other property sales.

He said Guangzhou Metro Corp was negotiating with various parties, including some listed property companies in Hong Kong, to buy the remaining lots.

He refused to identify the buyers, but noted that it would not cut land prices to lure foreign investment.

Half of the sites are for office use, and the rest residential.

Guangzhou Metro Corp plans to invest 12.7 billion yuan in Metro Line One. It already has invested 8.2 billion yuan, of which US$540 million was from a German export credit loan.

The 5.3-kilometre first phase - five stations from Xilang to Huangsha - will open on June 28.

Mr Wang said passenger flow on the first phase would remain low until the whole line - 18.4 km with 16 stations passing through the busy Zhongshan Road - was opened by the end of next year.

He said it would be difficult to set ticket prices because the government had to consider spending power of Guangzhou citizens and profitability of the company.

He suggested two yuan for a three-station trip and six yuan for the line.

The first German-made trains will arrive in Guangzhou for testing in April.