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CapitaLand marked its second office investment in Shanghai in just six months, with the acquisition of an office site for 838 million yuan (approx. S$171 million), revealed an SGX filing on Tuesday (19 December).
The transaction was carried out by its wholly-owned unit CapitaLand China, which intends to develop the land in the Wujiaochang decentralised business district (DBD) into a Grade A office building with a total gross floor area (GFA) of 37,765 sq m.
The company noted that the area is among the fastest-growing DBDs in the northern part of Shanghai. In fact, it has attracted many major global firms like Nike, Deloitte, IBM and Oracle.
Construction is expected to start in early-2018 and the upcoming project is anticipated to be the only new Grade A office in Wujiaochang when it is completed by 2020. Total investment in the property is estimated to amount to 1.3 billion yuan (about S$265 million).
Moreover, CapitaLand’s latest acquisition leverages on the strong leasing momentum of the adjacent Innov Center. Since the operational office with ancillary retail was bought in June 2017, around 40 percent of its premises have been occupied.
Altogether, Innov Center and the upcoming office building will have a GFA of 118,466 sq m upon the latter’s completion.
“This latest acquisition affirms our confidence in China, which is an important core market for CapitaLand. With Shanghai set to overtake Hong Kong as Greater China’s largest office market by 2020, we are optimistic about the growth prospects in this sector,” said CapitaLand’s President and Group CEO Lim Ming Yan.
“Upon completion of the acquisition, CapitaLand will enlarge its portfolio of commercial assets under management in Shanghai to over 1.4 million sq m in GFA across 19 properties.”
This article was edited by Keshia Faculin.
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