New | China shopping mall operator Insite targets cheap assets in expansion

Insite (China), a management-owned retail property fund and mall operator, will speed up expansion in tier-1 mainland Chinese cities in the next five years as chairman and chief executive Dickson Sezto sees abundant opportunities in buying malls on the cheap, given the oversupply and the threat from e-commerce.

The company, backed by US private equity fund Blackstone at its start in 2008, has established a strong name in the Chinese market, especially in Shanghai, by providing consulting services to developers and mall owners including Joy City Property Holdings and China Vanke.

The vast number of projects it has advised and the experience gained over the past six years will take the company to its next level - to gain full ownership or management of malls, the way Starwood Hotels & Resorts Worldwide expanded in the global hotel industry.

"Wanda is now bigger. But in the future, we'll be bigger," Sezto said, referring to the country's biggest shopping mall developer, controlled by Wang Jianlin.

In 2011, Sezto and his management team bought out Blackstone. His company now owns a shopping mall in Changsha. It also has full long-term management contracts of two projects in Shanghai and one each in Nanjing and Chongqing, with a combined investment of more than 6 billion yuan. Three more projects are in the pipeline.

The aim was to win full management contracts from small developers, which owned about 90 per cent of malls in the country, Sezto said.

Insite will raise funds from investors and will also commit its own money to upgrade some of the malls or even acquire a few.