新加坡政府投资公司x万科地产| GIC, Vanke Win Shanghai Retail Site for $111M

Leo Ding, chairman and CEO of SCPG is building a mall to challenge Wanda in suburban Shanghai

Singapore’s sovereign wealth fund GIC has teamed up with homebuilder China Vanke to win a plot of land in Shanghai for RMB 702 million ($111 million), which the partners plan to develop into a high-end shopping centre.

GIC subsidiary RECO Guangfulin Private Ltd and Vanke unit SZITIC Commercial Property Group (SCPG) acquired the commercial lot in the city’s suburban Songjiang district, an announcement by the municipal government shows. The plot, B06-03, was offered via public tender with the Singaporean and Chinese duo being the sole contender.

The partnership between the Singaporean sovereign wealth fund and the top five mainland developer comes less than two months after Vanke bought a score of shopping centres in China from Singapore’s CapitaLand.

Vanke Challenges Wanda in Shanghai’s Suburbs

The 46,800 square metre (288,473 square foot) site is located at the intersection of Yinze Road and Renmin North Road in the Guangfulin area. With a plot ratio of 1.5, the site has a buildable gross floor area of 70,200 square metres (755,627 square feet), representing a price of RMB 10,000 ($1,583) per square metre for the bidders.

Under the tender requirements, the plot’s new owners must develop the site and operate the property by themselves after completion. The completed property may have a height of up to 24 metres (79 feet).

Expected to be completed by 2022, the shopping centre is set to rival Shanghai Songjiang Wanda Plaza, which is two kilometres away. The project will most likely be branded INCITY, the flagship shopping centre product of SCPG, and will target young families and trendy urban residents. SCPG has eight shopping malls under the brand in second-tier cities Changshu, Suzhou, Ningbo, Hangzhou, Foshan, Xi’an and Tianji.

Vanke Keeps Building Retail Portfolio

SCPG’s flagship INCITY chain includes this mall in Hangzhou

Vanke joined with unidentified partners to acquire SCPG (SZITIC Commercial Property Co) from Blackstone in September 2016. The US private equity firm had in 2013 picked up a 40 percent stake in SCPG, at the time an owner of mid-sized community shopping malls.

Now the commercial property platform of China’s third-largest developer by sales is ramping up its mall portfolio in the country. Together with parent Vanke, SCPG entered a deal to buy 20 mainland shopping centresfrom Singapore’s CapitaLand for RMB 8.37 billion ($1.3 billion) last month.

GIC Raises Its Bet on Chinese Retail Property

The mainland developer and Singaporean sovereign wealth fund kicked off a strategic alliance in 2004, with GIC Real Estate acquiring stakes in two Vanke residential projects in Shenyang and Wuxi in late 2005.

GIC’s interest in Chinese shopping centres dates back to 2016, when the fund bought a 49 percent stake in six mixed-use projects from Joy City, the real estate arm of state-owned COFCO Group, in a joint venture with mainland insurer China Life for RMB 9.29 billion ($1.4 billion).

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