Shanghai Greenland
Not always the most prime but definitely the most agressive of all the China developers to go global. They are one of China's largest state-owned developers.
They stunned the market when they paid $1 bln USD for the Metropolis project in downtown LA. Acquired from the California State Teachers’ Retirement System in summer of 2013, the project is planned as a 275,450-square-foot (25,600-square-meter) development with hotels, apartments and luxury condominiums.
Brooklyn
In December 2013 they sold out 250 units in Downtown Sydney according to the Wall St. Journal.
Due to that success the group is expanding in Oz and it was South China Morning Post “We are looking for a few opportunities at the moment in Melbourne, Brisbane and Sydney, with total development values ranging from A$500 million (HK$3.58 billion) to A$3 billion.”
London
Greenland bought the historic Ram Brewery site in Wandsworth outside central London for £600 million and when a local London player fumbled it negotiations, Greenland stepped in quickly at Canary Wharf. The above is rendering of the proposed Hertsmere Tower.
Malaysia
PETALING JAYA: The Greenland Group is the latest developer from China to buy land for a sizeable property project in Johor's coastal Danga Bay area.
Greenland struck a deal in 2014 April to acquire 13.96 acres from Iskandar Waterfront Holdings Sdn Bhd (IWH) at cost of RM 600 million, where it plans to develop properties worth RM 2.2 billion in gross Development Value.
The price works out to RM 984 per sq ft - just below the record RM 991 per sq ft that Hao Yuan Pte Ltd, a Singapore-based but China-owned firm, paid for 37 acres in Danga Bay last December.
This is Greenland's maiden investment in Malaysia, for which it will form a joint venture with IWH to develop the land into an integrated project within five years. But the sale comes amid reports of tepid response from buyers for launches in Johor and Iskandar Malaysia.
The latest to feel the heat was Singapore’s Pacific Star Development Pte Ltd, which saw bookings for only 25% of the second phase of its condominium in Puteri Harbour.
Even so, the Shanghai-based Greenland, one of China's largest state-owned enterprises, is understood to be eyeing a GDV in excess of RM10bil in Danga Bay by the time it wraps up several more transactions in the coming months.
“This is only the beginning,” a source said.
According to industry executives, Greenland is set to finalise “very soon” the purchase of two more land parcels on the eastern corridor of Johor Baru near the Permas Jaya township, where Tropicana Corp Bhd is also a landowner.
Previous news reports had said Greenland was keen on acquiring around 60ha in Iskandar Malaysia.
Inclusive of the Greenland transaction, IWH has to-date inked 17 deals with local and foreign partners to develop properties worth RM127bil in GDV, providing a fillip to its ambitious plan of transforming the coastline of Johor bordering Singapore into a waterfront metropolis.
At least four other major China developers were in talks with IWH for mixed-use developments featuring waterfront properties, the company said in a statement.
“This massive influx of foreign direct investment is a boon for Malaysia and Johor because of the economic spillover and thousands of job opportunities that these projects will generate,” IWH managing director Tan Sri Lim Kang Hoo said.
“We believe Greenland Group will pave the way for more China state-owned companies to invest in outstanding property projects in Iskandar Malaysia and IWH’s extensive waterfront landbank in Johor Baru.”
A delegation from Greenland had visited Malaysia in February to explore investment opportunities. The state-backed group has over the past few years snapped up real estate in major cities such as New York, Los Angeles, Sydney, London and South Korea.
IWH is the master developer of 1,620ha of waterfront land in the eastern and western side of the Johor Causeway, with Danga Bay, located in Zone A of Iskandar Malaysia, as its centrepiece.
Other international property players which have secured a foothold in Danga Bay include Singapore’s Temasek Holdings Pte Ltd and CapitaLand Ltd, Australia’s Walker Group and China’s Country Garden Holdings Ltd and Hao Yuan, while local firms with ongoing developments include Tropicana and the Brunsfield Group.
Maybank IB Research had recently expressed concern about Iskandar Malaysia’s medium-term prospects, saying the massive incoming supply of residential and retail properties in hotspots like Danga Bay and Nusajaya could be harmful to asset values.
“Judging from the planned launches (serviced apartments, hotels, office and retail spaces) by Country Garden, Hao Yuan, Guangzhou R&F Properties Co Ltd, CapitaLand and Greenland Group, the hotspot areas, ie, Danga Bay and Tanjung Puteri, could be flooded with an enormous supply of high-rise mixed development projects, inducing price volatility,” it said in a client note last week.
“For instance, Guangzhou R&F plans to launch 15 blocks of 35-storey apartment buildings under phase 1 in the second half of this year, which implies an enormous 3,150 units of apartments, assuming six units per floor.
“That said, investor interest could return to developers with projects in Iskandar Malaysia on the finalisation of the Johor Baru-Singapore rapid transit system. Also, the listing of IWH in the second half could re-rate existing players in Iskandar Malaysia.”
PA International Property Consultants Sdn Bhd executive director V Sivadas told StarBiz that buyers were in “transition mode” due to changes in state policy and foreign ownership.
“People still have money, but they are being more careful about how they use it,” he said. -- 2014 April
Korea
They acquired a development project in Korea.
Canada
In March 2013 they announced a $360 million acquistion in Toronto but have yet to land their targeted development partner in Vancouver, B.C. which has been the hottest overseas real estate market outside Asia for the last two decades.
Singapore
Greenland is biding its time before entering Singapore
To be in the right place at the right time underscores the reason behind Greenland Holding Group's decision not to enter Singapore this year but also drives its interest to do so next year.
Having turned away from tabling a bid for a land parcel here in August, the Chinese state-owned developer is now actively studying upcoming land tenders in Singapore, said Greenland group executive vice-president Xu Jing.
"Because Singapore's land supply is low, competition is more intense. That's why we have not entered Singapore yet," Mr Xu told foreign media recently in Shanghai.
Given Greenland's strengths in mixed-use developments, the Shanghai-based developer is keen to undertake large-scale iconic projects in Singapore and Kuala Lumpur in Malaysia that will comprise homes, offices, hotels and retail malls.
"We hope to have a certain scale in our projects so that we have better control over project management costs," Mr Xu said. But the type of project that it will take on in Singapore will ultimately depend on the site's location and its land planning zone.
Greenland has already stood out among Chinese developers for its aggressive overseas moves in recent years, amid growing presence of Chinese investors in global real estate, and it is stepping up on its overseas expansion next year.
The group has already identified potential mixed-use projects in Kuala Lumpur, where it hopes to clinch them next year too.
"We are now in mature talks in Seoul, South Korea and Paris, France," Mr Xu added. "We may move into signing agreements soon."
Mr Xu explained that the group's internationalisation strategy began when it joined the list of top 500 companies globally in 2012 (ranked 268th), as the Shanghai government was encouraging Chinese companies in the Fortune 500 league to become international enterprises. Based on this year's targeted 400 billion yuan (S$84.8 billion) revenue, the group is set to rise further into the top 200 league.
Its headline-grabbing overseas moves included a US$500 million residential project in Sydney in 2013 and the US$1 billion mixed-use Metropolis project in Los Angeles. Greenland has invested in large-scale projects in South Korea's Jeju Island, including a healthcare town development project.
This year, Greenland acquired a historic site in Canary Wharf, London, for £600 million (S$1.2 billion) to build a mixed development, after its purchase of Wandsworth's Ram brewery site to build a tower comprising new homes and retail space.
It is also one of the biggest spenders in Malaysia this year, paying RM600 million (S$225 million) to Iskandar Waterfront Holdings for a 5.6 hectare site in Danga Bay, where it plans to develop properties worth about RM2.2 billion in gross development value. It also bought a 51.8ha plot in Jalan Tebrau, which it intends to start developing in about five years.
Greenland has since launched a preview for Greenland Jade Palace, a 759,609 square foot residential project in Danga Bay. Sales will begin around end-February next year.
Mr Xu said that pricing is not fixed yet as the costs computations and market forecasts are still being worked out.
Meanwhile, Greenland is seen trying to build up its brand in Singapore, going by the amount of prime-time television commercials that it has taken up recently. Some believe that it is drumming up interest ahead of its launch of the massive Jade Palace project.
Asked if he was concerned about the supply-demand dynamics in Iskandar, Mr Xu replied: "A good company will lead to create the market."
He recalled how Greenland started out some 20 years ago when Shanghai Pudong was still composed of tracts of farmland.
"We also asked ourselves the same question: 'Where are our customers?' But we have created the demand among Shanghai people - to have one apartment in the city and one villa outside the city. That was how we developed the market. This is similar to our Iskandar project, which is just across the causeway from Singapore."
In the same way, the group is hoping that its Johor projects serve as second homes for Singaporeans and, at the same time, meet the needs of local Malaysians.
Elsewhere, Greenland is seeking to gain a foothold in Thailand's luxury real estate market. It has lately teamed up with Thailand's Charoen Pokphand (CP) Group and Magnolia Quality Development Corporation to jointly invest 12 billion yuan in development projects, including luxury apartments, serviced apartments, retail and offices in Bangkok and Pattaya. -- 2014 Dec 16 BUSINESS TIMES
