CIFI and Hongkong Land combine for 7.3 billion yuan Pudong development
Mid-sized Hong Kong-listed mainland developer CIFI Holdings said it has signed an agreement with Hongkong Land Holdings to jointly develop a mixed-use property project in Shanghai's Pudong district with a total investment cost of 7.3 billion yuan (HK$9.3 billion).
The two firms will own the Shanghai Lujiazui Project via a 50-50 offshore joint-venture company and will jointly develop and manage it. The investment will be financed by internal resources and bank loans.
CIFI said the original owner of the project, on a site in Lujiazui, is venture company Yongpan, which is 49 per cent owned by CIFI and 51 per cent by Shanghai-based HuaAn Future Asset Management (Shanghai).
A number of reorganisation steps are required before the co-operation between CIFI and Hongkong Land proceeds, according to the two companies. For instance, CIFI will purchase 51 per cent of the equity interest in Yongpan from HuaAn and it is required to restructure its onshore debts.
The transactions will enable CIFI and Hongkong Land China, a wholly owned subsidiary of Hongkong Land, to jointly hold and develop the site with an offshore shareholding structure.
Lin Zhong, chairman of CIFI, said: "CIFI will leverage Hongkong Land's strong experience in developing and managing commercial properties."
The residential, office and commercial project occupies a site area of about 87,180 square metres and has a planned above-ground gross floor area of 227,000 sq metres. Scheduled for completion between 2017 and 2018, the project comprises 30,000 sq metres for residential use, 75,000 for office use and 120,000 for commercial use.