S&P Global Market Intelligence offers our top picks of Asia-Pacific real estate news stories and more published throughout the week. Please note that some entries may have links to third-party sources that may require a subscription.
GLP review winds down to no-shock ending
* Global Logistic Properties Ltd. finally on July 14 closed the eight-month-long chapter of the strategic review it started December 2016. Its conclusion: take the company private.
A consortium — composed of Hopu Investment Management Co. Ltd., Hillhouse Capital Management Ltd., SMG Eastern Ltd., Bank of China Investment Ltd. and Vanke Real Estate (Hong Kong) Co. Ltd., a unit of China Vanke Co. Ltd. — is offering S$3.38 per GLP share to delist the company. The consortium had been the subject of contention from other parties who were interested in buying GLP, as it was believed that the investor group would be chosen because it involved GLP CEO Ming Mei.
The consortium's bid also has the backing of GLP's biggest shareholder, GIC, and values the company at S$16 billion. If successful, GLP will delist from the Singapore stock exchange when the proposal is implemented on or before April 24, 2018, eight years after its Oct. 18, 2010, IPO.
Sunac's Wanda-ful surprise
* On the other hand, Sunac China Holdings Ltd. and Dalian Wanda Commercial Properties Co. Ltd. announced an unexpected 63.17 billion-yuan agreement, also dethroning China Vanke Co. Ltd. from its week-old record of the most expensive property deal in China.
Under the deal, Sunac will gain 76 hotels and a 91% stake in 13 cultural and tourism projects in the mainland. The company said it will use internal resources and/or banking facilities to pay for the portfolio, while the seller also agreed to grant Sunac a 26.60 billion yuan loan. Bloomberg News reported that Sunac's debt will skyrocket when the acquisition closes, allowing it to also grab another title under its belt: "China's most indebted developer." Credit agencies also acted promptly, with Fitch downgrading its ratings on Sunac, and S&P Global Ratings putting them on CreditWatch negative.
The sale to Sunac came as a surprise to market watchers, as Dalian Wanda Group Chairman Wang Jianlin has always been vocal about his ambition to become a leader in the theme parks market.
Zhang Hongwei, chief analyst at property brokerage Tospur, was quoted by London's Financial Times as saying that for Dalian Wanda, the deal is all about "relieving the pressure of their debt." Chairman Wang, meanwhile, told Caixin that "Wanda's debt load at this point isn’t heavy" and that the deal would help drastically trim it. Proceeds from the sale will be used to settle loans, which the company hopes to clear by year-end.
Hey big spender
* Mitsubishi Estate Co. Ltd. made news twice this week, both times because of big-ticket overseas deals with major players in their respective turfs.
In Thailand, it is partnering with AP (Thailand) PLC for two condominium projects worth 15.4 billion baht to be launched within the year. In Singapore, meanwhile, it entered into a joint venture agreement with CapitaLand Ltd. and CapitaLand Commercial Trust to convert a car park into a 29-floor mixed-use tower, under a S$1.82 billion budget.
* Scentre Group bought a roughly 80,000-square-meter town center site in Melbourne reportedly worth up to A$460 million.
* WeWork is preparing to debut in Japan in as many as 20 locations in central Tokyo, with Mitsubishi Estate being one of several building owners in discussions with the New York-headquartered co-working space company.
* South Korea's Mirae Asset Global Investments is in talks to buy a portfolio of offshore properties. It is believed that the 1.5 trillion won acquisition is a precursor to the asset manager's planned listing of a real estate investment trust abroad.
* Apple Inc. is building its first data center in China at Guizhou, as part of its US$1 billion investment commitment in the province.
* Blackstone India Real Estate Advisors is tipped to be in discussions to buy IL&FS India Realty Fund I, a US$525 million fund that closed 17 investments and six divestments since 2006. One of India's biggest property-focused funds, it is in exit mode, along with at least two other funds under the same owner.
* Yanlord Land Group Ltd., Perennial Real Estate Holdings Ltd. and Heng Yue Holdings Ltd. formed a special purpose vehicle for its pursuit to take over Singaporean developer United Engineers Ltd. To jumpstart the bid, the vehicle agreed on a S$729.7 million deal to buy a 33.4% stake in United Engineers and a 29.9% stake in its WBL Corp. subsidiary.
Featured during the week on S&P Global Market Intelligence
Data Dispatch Asia-Pacific: Asia-Pacific real estate companies raise US$36.7B YTD through June: Chart Watch: In June, SNL-covered Asia-Pacific real estate companies generated US$11.50 billion, the largest amount of capital raised in a month since June 2016.
Colliers: Hong Kong office sector demand pivots from pricey Central district: Alternative areas like Quarry Bay, Causeway Bay and Kowloon East are becoming popular options among multinational companies looking for significant savings in leasing costs.
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Celestyn Wong contributed to this report.