07 Aug 2019
The Sun Daily : Amprop expands Shanghai portfolio
Amprop expands Shanghai portfolio
The Sun Daily  I  07 AUG 2019 / 19:33 H

PETALING JAYA: Amcorp Properties Bhd (Amprop) and three others will jointly invest in four blocks of office buildings in Shanghai, China, under a co-investment agreement.

In a filing with Bursa Malaysia today, Amprop said its wholly owned subsidiary Amcorp Dynamic Ltd has entered into a co-investment agreement with Chelsfield Asia Fund 1, Limited Partnership, KHI Overseas Ltd and JRN Holdings Ltd in relation to the joint venture (JV) company known as Daning Partners Ltd.

Upon execution of the co-investment agreement, Amcorp Dynamic will subscribe to 40% equity interest in Daning Partners. Chelsfield will subscribe to 30% equity interest while KHI and JRN will hold 15% stake each in Daning Partners.

Based on the shareholding proportion, Amcorp Dynamic will contribute US$22.95 million (about RM96.18 million) to the JV company while Chelsfield will contribute US$17.21 million (about RM72.14 million). KHI and JRN will contribute US$8.61 million (about RM36.07 million) each.

Simultaneously, Daning Partners will enter into a shareholders agreement with Extra Noble Ltd whereby Extra Noble will subscribe for 50% equity interest in Daning Holdings Ltd.

Daning Holdings will acquire Bassan Development Inc from Time Best Global Ltd (vendor) for RMB1.454 billion (about RM865 million).

Bassan owns the entire equity interest in four property holding companies incorporated in Hong Kong which in turn, own the title interest of four blocks of office buildings in Daning International Commercial Plaza located in Jing’an District, Shanghai.

The properties comprise four blocks of strata offices with total gross lettable area of about 37,548 sqm with an occupancy rate of 85.4%. The rental rate of the properties is about RMB64.4 million (about RM38.3 million) per annum while the net book value is RMB1.09 billion (about RM648 million).

The properties were completed in 2006 and make up the office portion within a commercial complex known as Life Hub @ Daning, which includes retail blocks, office buildings and a four-star hotel.

The co-investment is part of Amprop’s strategy to expand its property investment portfolio in Shanghai’s commercial real estate segment, and enables Amprop to leverage on the experience and branding of Chelsfield in diversifying its international property investments and development portfolio.

Amcorp Dynamic’s capital commitment will be financed with advances from Amprop by way of internally generated funds of the Am-prop group and/or bank borrowings.

AmProp’s maiden investment in Shanghai was made through its co-investment with Chelsfield in July 2018, when it acquired five floors of strata offices in Llland Tower.