Buyer of Shanghai development is area’s district govt
MALAYSIAN tycoon Quek Leng Chan’s Singapore unit GuocoLand has inked a deal to sell a 24-storey office tower being built in Shanghai’s Putuo District for one billion yuan (S$202.6 million) to a state-owned enterprise of the area’s district government.
As the physical completion of the building and the completion of the transaction are expected to take place in May next year, profit from the sale is likely to be booked in the fourth quarter of the group’s current financial year ending June 2010. GuocoLand did not specify the profit quantum.
The office tower is being developed under the first phase of the Guoson Centre Changfeng, which is being built on a 50-year leasehold site that the group picked up in 2005 for 1.4 billion yuan.
Besides the office block, the other components of the project’s first phase are 354 small office, home office (Soho) units, a mall, a 443-room hotel and 347 serviced apartments.
The first phase is slated for completion next year.
The project’s second phase will see another three office towers and additional retail space being developed.
Guoson Centre is located at the Changfeng Ecological Business District in Shanghai’s Putuo District, at the intersection of three primary economic zones – Hongqiao, Gubei and Zhongshan Park.
GuocoLand sold the office block to Shanghai Putuo District State Asset Management Co. The latter’s vice-general manager, Zhao Yongsheng, noted that the Changfeng Ecological Business District, with a total planning area of two million square metres of office space, is a major business hub for priority development in Shanghai.
The company decided to buy the office tower from GuocoLand ‘as part of our real estate portfolio, in line with the Putuo District Government’s ongoing efforts to attract large domestic and multinational corporations to set up their headquarters in Changfeng Ecological Business District’.
GuocoLand posted net profit of $12.4 million for the first quarter ended Sept 30, 2009, against a $2.8 million net loss in the same year-ago period.
Gross profit was driven largely by contributions from property development projects in China.
Source : Business Times – 19 Nov 2009