NewJoy City Property eyes expansion in China's top-tier cities

Joy City Property, the Hong Kong-listed property arm of Cofco, mainland China's biggest food supplier, is looking for opportunities to expand into more top-tier cities while disposing of non-core assets to increase return.

Chairman Zhou Zheng told the South China Morning Post on Tuesday that his team was scouring a few second-tier cities including Wuhan and Xian, with clearer plans in Shenzhen and Nanjing.

"We want to deliver on our promise of opening one or two big mixed-use projects each year," he said after a shareholder meeting in Hong Kong to approve its 43.76 million yuan purchase of a site in Hangzhou.

That will be its eighth Joy City-branded project, which mainly consists of a shopping mall, office complexes and residential buildings. More than 60 per cent of the mixed-use projects are for sale to bring quick cash flow, with the company holding the shopping malls to generate steady rental income.

Joy City bought assets worth HK$12.5 billion from its parent last year, including six shopping malls targeting mainland China's rising number of middle-class families. It will open a seventh in Chengdu later this year. The mall in Hangzhou is scheduled to open in 2017.

The company is also open to acquisition opportunities in undeveloped sites and existing shopping malls.