Mapletree Investments has acquired a major retail and commercial complex in Hong Kong for HK$18.8 billion or about S$2.9 billion.
Mapletree, a wholly-owned property arm of investment company Temasek Holdings, said it is buying Festival Walk – located in Kowloon Tong on the Kowloon peninsula – from Swire Properties.
Festival Walk has a seven-storey shopping mall and a Grade-A office tower with a gross floor area of about 1.2 million square feet.
It is the Mapletree’s first commercial property purchase in Hong Kong, the company said in a statement.
The property will be a seed asset, forming part of a commercial property portfolio the company plans to build, under its Hong Kong-focused fund over the next two or three years.
Mapletree is buying the property together with other institutional investors as capital partners.
Mapletree group chief executive officer Hiew Yoon Khong said: “Given that Festival Walk is 100 per cent occupied with good quality tenants, upon completion, it will immediately provide good and stable returns to us and our capital partners.
“What is especially attractive about this asset is that the rental income has increased consistently year-on-year since inception, reflecting the quality of the mall.”
Festival Walk’s retail tenants include international brands H&M, UNIQLO, Toys “R” Us, Chanel, and Marks and Spencer, while office tenants include multinational corporations such as ANZ Bank and Prudential Assurance.
Mr Hiew said the acquisition reinforces the company’s strategy to scale up in key Asian markets.
“With this latest purchase, Mapletree’s total assets under management will grow a further 19.5% to about S$17.8 billion, of which 41% of it is constituted by overseas assets,” he added.
The company expects to complete the deal by end-August.
Source : Channel NewsAsia – 29 Jul 2011