CapitaMalls in S$1.28 billion joint venture in Suzhou

CapitaMalls Asia said yesterday it has signed a conditional agreement to form a joint venture to develop a shopping mall and office tower project worth about S$1.28 billion in Suzhou in Jiangsu province.

CapitaMalls Asia, a subsidiary of CapitaLand, will jointly develop and own a shopping mall and two office towers on a site in Suzhou Centre with Suzhou Industrial Park Jinji Lake Urban Development.

CapitaMalls Asia will take a 50-per-cent stake in the joint venture and contribute about S$637 million. It will fund its share of the total development cost through a combination of debt and equity.

The 310,000-sq-m project will include a 250,000-sq-m seven-storey mall and two 20-storey office buildings covering 60,000 sq m. The retail portion will account for about 81 per cent of the development’s total gross floor area.

The transaction is subject to the approval of the Chinese government.

The project is CapitaMalls Asia’s first development in Suzhou, the second-largest industrial city in China after Shanghai, and the second-largest among the Yangtze Delta cities.

The company said that the project reflects its strategy to “capitalise on its strengths and entrench its presence in the cities and regions that we are already in”.

Including this development, CapitaMalls Asia now has 55 shopping malls in 35 cities across China, of which 40 are operational and the remaining under development.

Shares in CapitaMalls Asia closed down 0.415 per cent to S$1.20 yesterday.

Source : Today – 30 Sep 2011

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