China South City to invest HK$16b in e-commerce push with Tencent

Mall and logistics park operator China South City plans to spend HK$16 billion in the coming financial year to buy land and develop more facilities to support a partnership with e-commerce giant Tencent. Income from services developed for e-commerce should triple over the next three years, it said.

The company will set aside HK$12 billion for capital expenditure and another HK$4 billion to HK$5 billion to buy land for the 2014-2015 financial year, said chief financial officer Stephen Fung.

China South City's capital expenditure plan is in line with its contract sales target for the year, which is set at the range of HK$18 billion to HK$20 billion, he said.

The company also aims to grow its recurring income to HK$1.5 billion to HK$2 billion in the next three years, from HK$655.7 million last year, through e-commerce channels and by tapping the growing market demand for warehousing.

China South City signed a cooperation memorandum with online major Tencent on Tuesday. The two agreed to cooperate in a range of areas, from e-commerce platform and network resources to the development of an integrated online to offline platform.

China South City will develop a Wi-fi intelligent digital solution service covering all its projects to disseminate promotional messages to users of Weixin, Tencent's mobile text and voice messaging communication system.