Keppel Land China secures residential site in Chengdu Tianfu New Area
Keppel Land China, a wholly-owned subsidiary of Keppel Corp., has secured a 4.7-ha residential site in the Chengdu Tianfu New Area for a total consideration of RMB 889.7 million ($134.3 million) in a government land tender. The Tianfu New Area is a state-level development zone in Sichuan Province, China.
The new site will be developed into a residential community comprising 768 units of high-rise apartments and 96 units of low-rise apartments. Targeted at home upgraders, the project is expected to be launched in the fourth quarter 2019.
Keppel Land China has also entered into a cooperation agreement with Chengdu Jin Se Hua Fu Real Estate Development Co., whereby Keppel Land China will establish a wholly-owned subsidiary, Chengdu Wan Ji Property Development Co., to develop the new site. Subject to Chengdu Jin Se Hua Fu completing the necessary procedures with the relevant authorities for the change in equity interest in NewCo, Chengdu Jin Se Hua Fu will then subscribe for a 70 percent interest in NewCo.
Based on a 30 percent stake, Keppel Land China’s total development cost for the project is expected to be in excess of RMB 519 million ($78 million).
Upon completion of the share transfer to Chengdu Jin Se Hua Fu, which is expected to take place in the first quarter 2019, Chengdu Jin Se Hua Fu will hold 70 percent equity interest in NewCo, and NewCo will then become an associated company of Keppel Corporation.
“Our six residential projects in Chengdu, including The Waterfront, The Botanica, Park Avenue Heights and V City, have been very well received by the local community,” said Ben Lee, president of Keppel Land China. “To date, Keppel Land China has launched about 17,800 homes in Chengdu, which are almost all sold out. We are confident that the new residential development will receive strong demand from upgraders looking for well-designed homes with strong value propositions.”
The site is located in the CBD of the Tianfu New Area and benefit from convenient transportation and access to educational institutions, commercial amenities and medical facilities. It is 600 meters (1,986 feet) away from Wuhan Road Station of Metro Line 1, 24 kilometers (15 miles) from Tianfu Square, the traditional city center of Chengdu, 17 kilometers (11 miles) from Chengdu Shuangliu Airport and 30 kilometers (19 miles) from the Chengdu New Airport that will be operational in 2020.
Since China’s State Council approved the Tianfu New Area as the 11th state-level development zone in 2014, it has been positioned by the central government as the economic engine for western China. It is designated as a base for industries such as new materials, energy conservation, biotechnology, IT and high-end equipment manufacturing.
Spanning a total area of 1,578 square kilometers (609 square miles), the Tianfu New Area currently has a population of 3.25 million, and it is expected to reach 5.85 million by 2030. The Tianfu New Area achieved a GDP of RMB 238.49 billion ($35 billion) in 2017, up 8.6 percent year-on-year. According to the Tianfu New Area’s long-term plan, its GDP is expected to exceed RMB 300 billion ($43.61 billion) by 2020.
