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CapitaLand seeks more active land-banking in China
PLANS are afoot for more active and aggressive land-banking at CapitaLand, after the opening of four integrated projects in China in April, including three Raffles City projects.
The group's third Raffles City private equity fund that closed last October at US$1.5 billion still has some US$1 billion of dry powder waiting to be deployed. Another US$2 billion worth of assets can be snapped up by the fund, assuming a 50 per cent leverage.
"The team is on the lookout for the right opportunities and will have some good news to share later this year or next year," said CapitaLand group president and CEO Lim Ming Yan on Sunday.
He was speaking to analysts and reporters after a tour of some of CapitaLand's newly completed projects in China.
Mr Lim said the group will continue to focus on the core markets of China and Singapore where it has strong development teams. In many developed markets, there are opportunities to acquire completed assets or assets close to completion where the group can value-add.
Elsewhere, CapitaLand will continue to grow and nurture the Vietnam market. It is back on the drawing board in India, where it may "reset" its strategy for the country, he added.
The completion of three Raffles City projects in Shenzhen, Changning in Shanghai and Hangzhou, as well as CapitaMall Westgate in Wuhan - spanning close to one million sqm in gross floor area - brings the group's total operational integrated developments across China's tier-1 and tier-2 cities to 15, including seven Raffles City projects.
CapitaLand China CEO Lucas Loh noted that these newly completed projects represent a new generation of integrated projects built by the group that are larger in size with richer offerings.
Raffles City Chongqing, the group's biggest investment in China and the largest-ever single investment in the country by a Singaporean company costing 24 billion yuan (S$5 billion) - is on track to open from the second half of next year.
CapitaLand is already a foreign developer with the largest portfolio of integrated developments in China, where other dominant players include Dalian Wanda, China Resources Land, Greenland, and Hang Lung Properties.
Despite the pervasiveness of e-commerce in China, CapitaLand said its newly completed shopping malls are doing well.
The retail components in the three Raffles City projects achieved some 95 per cent in committed occupancy and more than 20 per cent of the space is leased to new-to-market flagship and concept stores. Some 30-35 per cent of the space is taken up by food and beverage operators.
As of March 31, 2017, some 77 per cent of CapitaLand's total assets contribute to recurring income, of which shopping malls and integrated developments form the bulk. China has been a core market for CapitaLand, accounting for 44 per cent of its total assets.