CapitaLand to acquire office site in Shanghai for 838m yuan

CAPITALAND China, a wholly-owned unit of CapitaLand, has entered into a conditional agreement with an unrelated party to acquire a commercial site in Wujiaochang decentralised business district, Shanghai for 838 million yuan (S$171 million).

The site is next to CapitaLand's Innov Center, an operational office with ancillary retail that was acquired in June 2017. The latest acquisition of the adjacent office site is CapitaLand's second investment in Shanghai's office market in six months.

CapitaLand plans to develop the site into a Grade A office with a total gross floor area (GFA) of 37,765 square metres. On a completed basis, the total investment for the new office, including land cost, will be about 1.3 billion yuan.

Construction for the new office will begin early next year. It will be the only new Grade A office supply in Wujiaochang in 2020 when it is completed.

The combined GFA of the two office developments will amount to 118,466 square metres.

Lim Ming Yan, president and group CEO of CapitaLand Limited, said that upon completion of the acquisition, its portfolio of commercial assets under management in Shanghai will be enlarged to over 1.4 million square metres in GFA across 19 properties.

"This latest acquisition affirms our confidence in China, which is an important core market for CapitaLand. With Shanghai set to overtake Hong Kong as Greater China's largest office market by 2020, we are optimistic about the growth prospects in this sector," he added.