Bund plot sale latest swoop by developers
- Source: Global Times
- [10:26 June 13 2010]
- Comments
Workers on a construction site on the Bund in March this year. Photo: CFP
By Zhou Mi
SOHO China, a privately-owned Chinese property developer, has acquired a 22,462 square meter plot of land on the Bund by purchasing a company for 2.25 billion yuan ($330 million).
Pan Shiyi, CEO of SOHO China, announced the deal on his blog on Friday, which saw his company acquire a 90 percent stake in T&T International, giving it 61.5 percent indirect ownership of the plot, known as Bund 204 Land.
"We have prepared for the purchase for a long time," said Pan. "The price was high due to the property bubble, so we waited for the price to revert to its real value before realizing the purchase."
Xue Jianxiong, an analyst with property consulting company China Real Estate Infor-mation, said the purchase was a bargain for SOHO China. "The average price per square meter they paid is around 20,000 yuan ($2,927), nearly 30 percent less than the price at the end of 2009," Xue told the Global Times Saturday. "If SOHO choose to cash in by selling the land once it has been developed, they will earn big money, since the spread between the price they paid and the expected market rebound will be bigger."
"There are only limited plots on the Bund, so it's worth the price considering the rarity," said Liu Yonghuan, an analyst with China Index Academy.
The plot of land has a total area of approximately 22,462 square meters, and is designated for commercial purposes. SOHO China also acquired T&T International's rights to an above ground development area of approximately 69,000 square meters, with approximately 12,000 square meters of underground commercial space and approximately 50,000 square meters for storage and parking facilities.
SOHO China's expansion in Shanghai mirrors moves by a number of big developers in China.
Poly Real Estate, a state-owned developer, recently purchased two plots of land in Pujiang Town in Shanghai for 2.6 billion yuan ($380 million), while China Vanke, a privately-owned developer, purchased three plots in Shanghai in February for 2.46 billion yuan ($360 million).
