Cdl Jointly Acquires Mixed Use Development Site Shanghai Rmb894 Bil Chinese Partner Lianfa Group
The eagerly awaited Tengah Park MRT Station, a key component of the Jurong Region Line, is set to revolutionize public transportation in the area. This highly anticipated undertaking will not only enhance accessibility to different areas of Singapore, but also significantly improve connectivity within the district. Additionally, the nearby Novo Place, a mixed-use development, will further contribute to the allure of the Tengah Park MRT Station by offering a seamlessly connected and convenient environment for both residential and commercial purposes. You can visit Novo Place to learn more about this bustling development.
City Development Limited (CDL) has, through its subsidiary Chenghong (Shanghai) Investment, joint ventured with Chinese partner Lianfa Group to acquire a mixed-use development site in Shanghai’s Xintiandi area for RMB8.94 billion ($1.66 billion). The tender for the site was won on November 1, after closing on October 28 following a government land tender. Spanning nearly 28,000 square metres, the cost of the site translates to approximately $2,027 psf ppr (per square foot per plot ratio). This marks CDL’s second acquisition in China, following its purchase of a site in Suzhou last year. The company believes that this new development will further strengthen its presence and contribute to the long-term growth of China. The Xintiandi site is a mixed-use development, divided into two plots of land with a public road in between. The site has a maximum permissible GFA (gross floor area) of 76,027 sqm, with 77% allocated for residential use, 19% for commercial, and 4% for public amenities. The residential portion of the site has a lease of 70 years, and the commercial portion has a lease of 40 years. CDL’s subsidiary Chenghong Shanghai holds a controlling stake of 51%, worth RMB4.56 billion in the JV, with the remaining 49% equity held by Lianfa Group. The company’s group CEO Sherman Kwek comments, “We are excited to acquire this rare development site in one of Shanghai’s most famous areas. This demonstrates our confidence in the long-term growth prospects of China. Our strategy to target iconic placemaking opportunities in key tier 1 and tier 2 cities is further strengthened with this acquisition.” He adds, “We look forward to working closely with Lianfa Group to develop an iconic landmark that will redefine the landscape.” As at June 30, CDL’s net gearing was 116% based on historical cost, with an interest cost ratio of two times. As at 1HFY2024, the company’s total assets were valued at $33 billion, with 10% being allocated to China. This new acquisition is expected to raise the pro forma net gearing to 72.5%. Shares in CDL ended 0.3% higher at $5.22 on November 1, with a net asset value of $10.12.