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Pan Hong acquires land for residential project in Huzhou City for 275m yuan
MAINBOARD-LISTED Pan Hong Holdings Group has made a successful 275 million yuan (S$54.4 million) bid for the land use rights of a plot located in Huzhou City in China's Zhejiang province.
The land, sold by the Huzhou Bureau of Natural Resources and Planning (HBNRP), is for residential use. It has a total site area of 36,122 square metres (sq m) and maximum gross floor area of 65,020 sq m, the property firm said on Wednesday.
Pan Hong said that the land will be used for the development of a residential project which will increase the group's investment proportion in residential properties.
The transaction will be funded by the group's internal resources and/or bank borrowings as its board deems fit. A deposit of 44.4 million yuan has been paid by Pan Hong, with half of the 275 million yuan due within 30 days of June 4, which is the date of the bid confirmation. The remaining half of the sum is to be paid six months from the same date of the bid confirmation.
As part of the land acquisition, Pan Hong is required to pay 400,000 yuan in compensation to the local government due to the existence of several buildings and premises on the land, and will be responsible for demolition. It must also retain at least 35 per cent of the total gross floor area of the land under its own title for a minimum of eight years.
In addition, Pan Hong must also build a wine culture exhibition centre with a gross floor area of at least 2,000 sq m on the land, as part of corporate social responsibility.
The 275 million yuan price took into account the minimum bid price, current market conditions, land location and land price in the surrounding areas.
The group said the transaction is not expected to have any material impact on its earnings per share or net tangible assets for the fiscal year ending March 31, 2020.
It also disclosed that none of its directors or controlling shareholders has any direct or indirect interest in the transaction other than their shareholding in the group.