Just before heading off for China’s National Day holiday Swire Properties confirmed its purchase of stakes in a pair of mixed-use projects in Shanghai’s Pudong district from local government developer Lujiazui Group as it continues to expand its holdings in mainland China.
“In line with our HK$100 billion investment plan, we are very pleased to have secured these two major investments in Shanghai, which will significantly scale up our presence in this important city,” said Swire Properties chief executive Tim Blackburn in a statement. “Following the success of Taikoo Li Qiantan, we are delighted to be working with our partner Lujiazui Group again.”
The blue-chip Hong Kong developer said that it purchased 40 percent stakes in both a commercial-dominated project near its existing shopping centre in Pudong’s Qiantan area, and a residential-driven development in the district’s Yangjing neighbourhood from Lujiazui Group for a combined RMB 9.7 billion ($1.35 billion), with plans to develop retail, office and residential space on the plots.
Swire had signed preliminary agreements related to the projects last year, with Mingtiandi reporting the investment plan last month. The joint venture partners are building nearly a million square metres (10.7 million square feet) of space on the sites, after Swire’s Taikoo Li Qiantan retail joint venture with Lujiazui Group succeeded in winning the hearts and wallets of consumers in eastern Shanghai.
First Mainland Residential Projects
Both the Yangjing project, which is located betwee the Lujiazui financial district and the Yangpu Bridge along the eastern banks of the Huangpu, and the Qiantan development, which occupies a slice of the former Expo site around 15 kilometres (9.3 miles) to the south, will combine retail, office and residential space, with the Yangjing plot to accommodate cultural uses as well.
The two projects represent Swire’s first residential projects in mainland China, after it developed a portfolio of successful shopping centres and office blocks in Shanghai, Beijing, Guangzhou and other urban hubs.
The 151,934 Yangjing site was home to Swire Group’s Taikoo Wharf from the early to mid-1900s which was next to set of warehouses that were once the largest grain storage facilities in Asia, the company said in release. Including around 20,000 square metres of below ground retail, the new project will yield nearly 390,000 square metres of mostly residential space.
“Swire Properties has a proven track record in creating long-term value by transforming urban environments, and has accumulated over 50 years of experience in designing, developing, and managing influential, large-scale commercial projects, said Xu Erjin, chairman of Shanghai Lujiazui Group. “Our first joint venture project, Taikoo Li Qiantan, has become a landmark in Shanghai, and we are pleased to join hands with Swire Properties again.”
In Qiantan the partners will work together to develop a 63,804 square metre plot into approximately 602,431 square metres of space, including below-ground area.
Located at the intersection of three metro lines, the site is directly opposite Taikoo Li Qiantan, which the partners officially opened in September of last year. That 116,000 square metre mall had achieved committed occupancy of 95 percent by the end of June.
“Pudong is undergoing a remarkable transformation under the Shanghai Master Plan 2017-2035,” Swire’s Blackburn said. “We see significant development potential for these two sites, supported by a wide range of growing infrastructure, including schools, hospitals, sports facilities and transportation networks.”
Shanghai Growth Spurt
This latest announcement will bring Swire Properties’ Shanghai project count to five within the next five years, with the Yangjing development having broken ground in November of last year set for a target completion date of 2028. The Qiantan project started construction in March 2020 and is aiming for a June 2025 completion date, according to an account in Guandian.cn.
“Together, these two investments mark a new chapter for Swire Properties’ growth in Shanghai, and are testimony to our long term commitment to developing iconic landmarks in the Chinese Mainland,” Blackburn said.
The Pudong developments are set to add to Swire Properties’ existing footprint in China’s commercial capital where, in addition to its Qiantan mall, it also has the HKRI Taikoo Hui commercial project in Jing’an District and Zhangyuan, a renovation of a community of early 20th century traditional lane homes across Shimen Road from HKRI Taikoo Hui, which it jointly operates and manages.