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Real Estate News & Analysis: May Edition


Mitsubishi Estate's FY'18 profit rises; Swiss fund eyes RE markets in Asia

* Japanese developer Mitsubishi Estate Co. Ltd. surpassed its ¥112.00 billion forecast for its profit attributable to owners of parent in the fiscal year ended March 31 after it reported a 17.3% year-over-year increase in the metric to ¥120.44 billion. EPS during the reporting period also grew 17.3% to ¥86.78, while income before taxes and special items climbed 12.2% to approximately ¥190.51 billion.

* Swiss pension fund Publica is planning to invest CHF300 million to pan-Asian mandates. The amount represents 20% of the roughly CHF1.5 billion that Publica intends to spend on international real estate assets.

Hong Kong and China

* Singaporean wealth fund GIC Pvt. Ltd., in partnership with the Warburg Pincus & Co.-backed Shanghai-based property investor Nova, is planning to launch an approximately 4.30 billion-yuan rental apartment platform targeting prime projects in first-tier Chinese cities. A deal paving the way for the platform's launch is expected to close within the third quarter, subject to relevant regulatory approvals.

* Swire Properties Ltd.'s Cityplaza Three and Cityplaza Four buildings in Taikoo Shing, Hong Kong, are expected to fetch between HK$19 billion and HK$23 billion, according to brokerage houses cited by The (Hong Kong) Standard. The listed developer said earlier that it is in discussions for the potential sale of the two properties, which caught the attention of Wheelock and Co. Ltd. Vice Chairman Stewart Leung Chi-kin, according to the report.

* Hong Kong-listed developers Shui On Land Ltd. and Yida China Holdings Ltd. announced the completion of their 3.16 billion-yuan deal for the transfer of a 61.54% stake in Richcoast Group Ltd., the owner of a mixed-use joint venture project in Dalian, China. In light of the transaction, Richcoast ceased to be a subsidiary of Shui On Land and is now 71.80% owned by Yida China.

* Diversified property developer Sun Hung Kai Properties Ltd. is teaming up with Multiplex Cinema Ltd. for the planned launch of the HK$400 million Movie Town in New Town Plaza in Hong Kong's Sha Tin district. The Standard reported that the 1,700-seat cineplex is expected to become the largest cinema in the city's New Territories region.

Australia

* The Victorian state government approved the Melbourne Council's proposal to transform a 6,500-square-meter site in Munro into a A$450 million apartment and hotel project. The permit, according to The Australian Financial Review, is for two towers standing 38 stories and 10 stories high.

Private company PDG Corp. was tapped to develop the project, with the first phase to feature 56 affordable housing units, a 120-place childcare facility, family and children's services center, a community center and a 503-bay carpark.

* Sydney-based investment house AsheMorgan will commence the construction of the final phase of its A$150 million redevelopment of the former Harbour Town mall in Melbourne's Docklands suburb, the AFR reported. The ongoing The Market development will feature a 3,800-square-meter Woolworths, a Dan Murphy's liquor store, a Priceline pharmacy and 25 specialty retailer outlets upon its expected mid-2019 completion.

Japan

* Kenedix Office Investment Corp. entered into a ¥20.70 billion agreement for the acquisition of trust beneficiary interest in the fully occupied, 10-story Cross Place Hamamatsucho office building in Tokyo. The company said it will use a combination of cash on hand, proceeds from a public offering of new investment units and income from asset divestments to finance the agreed-upon transaction.

* Two groups are participating in the secondary bidding for the Umekita redevelopment project that will sit on an approximately 16-hectare site in Kita Ward in Osaka City. The first group includes ORIX Real Estate Corp., Hankyu Corp. and Mitsubishi Estate, while Daiwa House Industry Co. Ltd. is one of the members of the second group, Mainichi Newspapers reported. The winning bid will be announced in late July.

India

* The Supreme Court formed a three-member panel to oversee the auction of Unitech Ltd.'s over 600 acres of unencumbered immovable properties, the Economic Times of India reported. Proceeds raised through the auction will be used to reimburse the money paid by customers for the reservation of units in various Unitech projects.

Malaysia

* Singaporean developer GSH Corp. Ltd. booked 330 million ringgit from the oversubscribed sale of 100 units at its Coral Bay luxury condominium project in Kota Kinabalu, Sabah, The (Singapore) Business Times reported. The development includes 460 apartment units across eight 12-story buildings and is scheduled to be completed by 2022.

Other real estate news

* Lendlease Corp. Ltd.'s A$7 billion joint venture project with London's Haringey Council could face a roadblock after it gained opposition from British labor leader Jeremy Corbyn, The Australian reported, citing accounts from British media. The joint venture, which secured the support of London's High Court in February, is planned to deliver about 5,000 new homes, 40% of which will be affordable housing.

* Australia's Cromwell Property Group is partnering with the Bouygues SA-affiliated Linkcity for a plan to roll out a €500 million portfolio of logistics and light industrial assets in Central and Eastern Europe.

The first asset to be seeded in the portfolio is an 88%-leased, 8,000-square-meter logistics building in Prague. This will be followed by two more properties with a combined area of 180,000 square meters.

The Daily Dose Asia-Pacific, Real Estate edition is updated by 6:30 a.m. Hong Kong time. Some external links may require a subscription. Links are current as of publication time, and we are not responsible if those links are unavailable later.

Rollen Catorce and John Chan contributed to this report.

As of May 14, US$1 was equivalent to 6.34 yuan, ¥109.61 and 3.95 ringgit.