Joint venture for retail mall development in China with Tesco plc and Metro Holdings Limited
HSBC Specialist Investments announces the completion of a joint venture investment with wholly-owned subsidiaries of Tesco plc (Tesco) and the Singapore-listed Metro Holdings Limited (Metro) in a portfolio of 3 retail malls totalling 2,468,000 sqft of gross floor area. Two of the assets are located in the cities of Fuzhou and Xiamen in the southern Chinese province of Fujian. The third asset is located in the city of Shenyang in north-east Chinese province of Liaoning.
All of the malls are currently under development and are anchored by a Tesco hypermarket. The remaining space is to be let to a mix of international, national and regional brands. The total capital value of the transaction is c.US$280m.
This is the second joint-venture investment between HSBC Specialist Investments, Metro and Tesco. The first joint-venture for 2 mixed-use developments and one mall development in north-east China closed in December 2009. All 3 malls of the first joint-venture investment successfully opened in 2010.
Stuart Jackson, Head of Real Estate for HSIL, commented:
“This investment provides us with an opportunity to build on our excellent relationship with Tesco accessing 3 high quality retail assets in fast-growing Tier 2 cities in China. The properties will be developed and managed by Tesco who are an experienced partner with a strong track-record in both Europe and Asia. The investment provides exposure to domestic retail consumption which is expanding rapidly."