[photopress:property_dapeng_pic.jpg,full,alignright]China Central Properties, the AIM-listed property company that invests in Chinese development projects, has paid US$196 million for a 1.4m office development in Guangzhou.
The purchase was from Guangzhou Heyin Plaza Development Company. It will pay $108 million in cash and the rest in bank debt.
The Guangzhou Heyin Plaza (which may by now be called the Dapeng Plaza although this seems debatable which makes out illustration a bit iffy but we think it is right) development is a 51-storey office with a 5-level retail podium, which is scheduled for completion in 2010.
China Central listed on AIM in June 2007, and raised $530 million through a combination of shares and convertible bonds. It has seen shares fall 40% since listing, in line with the broader AIM-listed property sector.
Explaining, a bit, what was happening and what may happen in the future chairman Vincent Lo said, ‘Speculation, overheating of the economy and increasing inflationary pressure have prompted the Chinese Central Government to introduce progressive austerity measures. The consolidation of smaller players will create an increase in supply of partially-completed property projects, feeding directly into CCP’s business’
In othe words the propery recession will be bad for the small players but perhaps good for those of considerable size.
Source: Property Week