Henderson Land bets 4b yuan on Jiangsu project
Developer to build luxury homes
Henderson Land Development will invest about four billion yuan to develop an upmarket residential project in Yixing, Jiangsu province.
The project, in the Dongjiu district of Yixing, will be the second investment in the city for Hong Kong's fourth-biggest developer by market value.
'The land cost is already more than one billion yuan. The total investment value will be about four billion yuan,' a source said.
With a site area of 5.6 million square feet and a plot ratio of 1.6 times, the development would yield a total gross floor area of about nine million square feet, the source said. The project will be wholly owned by Henderson Land.
In July, the company signed a contract with the Yixing city government to invest about 300 million yuan on building luxury residences and low and high-rise flats on a site of about 37,000 square metres in the central district.
Henderson Land bought the site for 158 million yuan. Now it is planning a project 13 times bigger.
The investment proposal is in line with plans by the Yixing city government to turn the district into a new town comprising leisure, residential, office and hotel facilities.
It is a popular resort area offering tourist destinations such as the Dongjiu Lake.
Henderson Land executive director John Yip Ying-chee had previously said the group was confident about the outlook for Jiangsu province because of its robust economy.
Jiangsu's gross domestic product rose 15 per cent in the first half of the year, with its urban residents' per capita income climbing 17.3 per cent from a year earlier to 8,575 yuan.
The latest proposal follows a series of land buys in the mainland by Henderson Land, which is controlled by Lee Shau-kee.
In its annual results released last week, the company said it was in talks to acquire another 50 million sqft of developable floor area.
As of last month, Henderson Land had acquired a mainland land bank of 36.69 million sqft, an increase of 154 per cent over the previous year.
The additional sites would provide a total developable gross floor area of 101.5 million sqft, the company said. These developments would cost 25 billion yuan.
With formalities for the latest land acquisitions to be completed by the end of this year, the group's land bank on the mainland will increase to about 150 million sqft.
Meanwhile, the mainland's property market continues its robust performance, according to the National Development and Reform Commission.
The top planning agency said prices of homes in 70 cities nationwide rose 8.2 per cent year on year last month.
Venture could yield gross floor area of nine million square feet
Jiangsu's GDP rose 15pc in the first half, with urban per capita income growing 17.3%