CapitaLand snaps up Guozheng Center for $535m

But it is ditching Innov Tower for $316m.

CapitaLand has entered into agreements to acquire Guozheng Center located in Yangpu District, Shanghai, China, at an agreed property value of $535m.

This came with its plans of divesting Innov Tower, an eight-year-old office building located in Shanghai’s Xuhui District at a $316m value.

CapitaLand CEO and President Lim Ming Yan said the divestment of Innov Tower allows the group to unlock and realise the value of a stabilised asset at an optimal stage of its life cycle, whilst the acquisition of Guozheng Center allows the group to immediately redeploy the capital to another quality income-generating asset.

"On completion of the two transactions, CapitaLand will have a sizeable portfolio of commercial assets under management in Shanghai, at over 1.3 million sq m in GFA across 17 properties, deepening the Group's presence in China’s top tier cities. This enhanced office portfolio in Shanghai will put us in a favourable position to tap into Shanghai's growth. Shanghai is set to overtake Hong Kong as Greater China’s largest office market by 2020,” Lim noted.

Including Guozheng Center, CapitaLand owns and manages 17 commercial properties in Shanghai that span over 1.3 million sq m in GFA. These include seven integrated developments – Raffles City Shanghai, Raffles City Changning, Capital Square, Capital Tower Shanghai, Hongkou Plaza, Minhang Plaza and LuOne; a shopping mall CapitaMall Qibao; seven serviced residences – Ascott Huai Hai Road Shanghai, Ascott Heng Shan Shanghai, Citadines Biyun Shanghai, Citadines Jinxiu Shanghai, Citadines Putuo Shanghai, Somerset Xu Hui Shanghai and Somerset Waigaoqiao Shanghai; and StorHub Shanghai.

Shanghai is part of five city clusters in China that CapitaLand has identified for growth, which comprises Beijing/Tianjin, Shanghai/Hangzhou/Suzhou/Ningbo, Guangzhou/Shenzhen, Chengdu/Chongqing/Xi’an, and Wuhan.