The Great Mall: Construction in progress for the world’s largest integrated mall in Hebei province.
KUALA LUMPUR: Berjaya Land Bhd (BLand) aims to have a bigger presence in China's property market after its maiden commercial development, the Great Mall of China (GMOF) in Yanjiau city, Hebei province, started construction recently.
BLand chief executive officer Datuk Francis Ng said despite the cooling measures by the Chinese government, the country's property market still offered good opportunities for growth.
Ng says market sentiment is still potentially strong across all major real estate sectors in China.
“We are keen on the tier-two cities such as Xiamen, X'ian, Chengdu and Tianjin as the land cost is relatively cheaper compared with the tier-one cities such as Beijing, Shanghai, Shenzhen and Guangzhou,” Ng told StarBiz.
Ng said the tier-two cities such as Yanjiau city in Hebei province were witnessing huge level of infrastructure investment by the central government which had resulted in unprecedented city building and modernisation initiatives.
He pointed out that tier-two cities “which did not make the cut” earlier would be the cities to watch in the next decade because of the strengthening economies and emerging real estate activities in those cities.
“China's economy has over the last three years grown by over 30% in real terms to become the world's second largest economy.
“The market sentiment is still potentially strong across all major real estate sectors in China given its large and diverse economic activities, a strong presence of domestic firms and multinational companies, and a critical mass of international retailers and hotel operators there,” he said.
BLand's 51%-owned subsidiary, Berjaya Great Mall of China Co Ltd (BGM) is undertaking the development of the GMOC. The balance 49% is owned by Berjaya Group founder Tan Sri Vincent Tan through his private arm, Berjaya Times Square Cayman Ltd.
Ng said Tan bought the 76 acres in 2004 at a cost of RM30mil and in 2008, he divested 51% of his stake to BLand “at cost” of RM15.3mil, although the market value of the land had appreciated to RM2.5bil.
GMOC, billed as the world's largest integrated entertainment and commercial mall development with gross floor area (GFA) of 18.5 million sq ft, is scheduled for completion in 2017.
Presently, the New South China Mall in Dongguan with gross floor area of 9.58 million sq ft is the largest mall in China.
Ng said GMOC was expected to contribute to BLand's earnings by the middle of 2013 with the launch for sale of the retail space in August this year.
Since construction started in 2010, almost 40% of phase one of the project has been completed. Phase one comprising one million sq ft shopping mall and three theme parks is expected to be completed by October 2013.
BLand general manager of group properties and development Michael Pua said the project had received a lot of enquiries and interest.
“The target buyers are the Chinese investors, the local and international retailers,” he said.
By The Star