Soho China acquires property in Qianmen
Soho China has acquired 54,691 square metres of commercial and retail property in Qianmen district in Beijing for 1.77 billion yuan (HK$2.01 billion), after failing to get government approval to acquire 134,333 sqmetres of land in the historic commercial district for 5.25 billion yuan.
The mainland developer had hoped to acquire the 33 parcels of land in Qianmen in 2007, which was a key selling point of the company's initial public offering in Hong Kong in October that year.
'Notwithstanding continuous efforts by the company, such approvals have not been forthcoming. This is the only viable way to resolve the impasse as a result of [that],' Soho China founding chairman Pan Shiyi said. 'This restructuring is the best solution for Soho China as it allows us to acquire properties at the best locations in Qianmen for 32,328 yuan per square metre.'
Soho China chief executive Yan Yan said the newly acquired project was expected to affect the company's financial results as early as this year.
Under the agreement signed on Friday, Mr Pan will receive 1.3 billion yuan which his private company, Beijing Danshi Investment Management, had already invested in the Qianmen properties.
The remaining 79,642 sqmetres which Soho was not able to obtain will be sold back to the local branch of the State-owned Assets Supervision and Administration Commission.
Mr Pan said he did not know why Soho China had failed to obtain government approval to acquire the entire Qianmen project for two years.
Activist groups like the China Heritage Foundation had protested against Soho China's plans to develop the Qianmen project.