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CapitaLand announced on Tuesday (13 Nov) that a subsidiary has established a 50:50 joint venture with Singapore’s sovereign wealth fund GIC to purchase Shanghai’s tallest twin towers for a total of RMB12.8 billion (approx. S$2.54 billion).
The Singapore-based developer is carrying out the deal via Raffles City China Investment Partners III (RCCIP III), where CapitaLand owns a 41.7 percent stake, while the remaining interest are controlled by investors from Asia, North America and the Middle East.
Located in Hongkou District on a 4.05ha site along the Huangpu River in North Bund, the ongoing development will become CapitaLand’s third Raffles City integrated project in Shanghai. It will be the ninth of its kind in China and the 10th in world, including Raffles City Singapore.
Expected to be completed in phases from the second half of 2019, the project consists of two 50-storey Grade A office towers standing on top of a seven-storey shopping mall. Excluding parking space, the project has a total gross floor area (GFA) of 312,717 sq m.
Aside from being directly connected to Line 12 and the future Line 19, two major metro lines with the highest number of interchange stations in Shanghai, the 263m-tall towers will provide 270-degree views over Lujiazui CBD and Shanghai Bund on both sides of Huangpu River.
“This acquisition gives CapitaLand a distinctive Raffles City in the fast-developing North Bund of Shanghai,” said Lee Chee Koon, CapitaLand Group President and Group CEO.
“This prime asset will begin operations in phases from H2 2019, giving us speed to market in the competitive Shanghai market, which continues to power ahead. CapitaLand remains the foreign developer with the largest portfolio under management in Shanghai, a strong market with the depth to support our third Raffles City integrated development.”
Notably, Shanghai’s gross domestic product surpassed RMB3 trillion for the first time in 2017. It is the highest in China, second in Asia Pacific and 10th globally. The city’s robust economic growth is supported by China’s busiest aviation hub, pro-business policies to entice foreign investments, more than 1,300 multinational companies based there and the city’s population of over 24 million.
In addition, CBRE revealed that property investment in Shanghai surged by 83 percent year-on-year to RMB23.5 billion in the first nine months of 2018.
Meanwhile, CapitaLand said on Monday (12 Nov) that it has successfully secured a prime mixed-use site in Guangzhou, China for RMB882 million (approx. S$175.2 million).
Located in Huangpu District, one of China’s richest districts by GDP per capita, the 4.7ha greenfield site is situated within Guangzhou Science City, a state-backed innovation and tech hub.
The development to be built there will have a GFA of 142,107 sq m. Of this, 70 percent will be used for office, retail space and serviced residences, while the remaining 30 percent will comprise low-density strata offices.
CapitaLand owns a 75 percent stake in the project, which is expected to be ready by 2022, while the remainder is controlled by an unrelated third party.
Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories, email romesh@propertyguru.com.sg
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