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Elaine Chan

DESPITE retail blues experienced by retailers who have entered or plan to enter the mainland market, Pacific Concord (PC) remains confident about retail property in Shanghai.

  The company said it would not sell the 1.6 million square foot retail space component in its 3.2 million sq ft flagship development, Shanghai Concord Plaza, but would offer it for rent when ready.

  The development, to be ready in 1998, comprises four residential blocks and an office tower on top of a two-storey retail podium.

  The firm has a 60 per cent stake in the Jingan district development which cost three billion yuan (about HK$2.79 billion) to build.

  The rest of the stake is held by the district government.

  The company's chairman, Wong Sai-chung said the firm would release more units in one of the residential blocks, Mayfair Mansion, covering about 300,000 sq ft, for pre-sale in the next two months.

  He said the price would be similar to the $2,000 per sq ft asked for the previous pre-sale last October.

  He said it was one of the least expensive developments in Shanghai, and had a 'good location'.

  'Investors purchasing the units for the purpose of leasing them out will get their returns in two years,' Mr Wong said.

  Of the four residential blocks, the company intends to sell two and the rest will be leased. It expects the value of residential properties in the district to soar rapidly.

  The apartments are also suitable for commercial use.

  Mr Wong said about 600,000 sq ft in the office tower would be rented.

  The first phase of the retail podium would be available at the end of next year.

  'We are very positive about the demand for retail space, especially in Shanghai with a population of 13 million,' he said.

  'There is a huge development of individual entrepreneurship.'   One of the main businesses of the company on the mainland is department stores.

  Mr Wong was confident past losses suffered by the firm would be reversed this year because it was learning more about the Chinese retail market.

  'Selling branded goods at this stage will never succeed,' he said.

  He argued that consumers could get similar products that were made in China, at lower prices than those asked for the imported item.



PC backs retail property