July 27 (Bloomberg) -- Excellence Real Estate Group Ltd. won the bidding for two commercial sites yesterday in the first land auction of Shenzhen’s Qianhai special zone.
The Shenzhen, China-based developer will pay 12.4 billion yuan ($2 billion) for the land, according to a statement on the Qianhai Authority website.
China chose the Qianhai district of Shenzhen, a city that borders Hong Kong, as the testing ground for freer usage of the yuan. The authority will spend up to 300 billion yuan by 2015 on infrastructure and targets a gross domestic product of 150 billion yuan by 2020, Xiao Yafei, director general at the Office of Financial Development Service of Shenzhen, said in Hong Kong on July 10.
Excellence will pay 5.18 billion yuan for an office-hotel-serviced apartments site, 48 percent above the opening bid of 3.5 billion yuan, the South China Morning Post reported today. The company won the second site, which will will hold offices and serviced apartments, for 7.18 billion yuan, making the site the most expensive land in Shenzhen, the English-language newspaper said. The two plots have a total gross floor area of 770,600 square meters, the Qianhai Authority said in a July 26 statement.
Hong Kong Companies
Qianhai will sell another plot targeting Hong Kong-listed companies on Aug. 16, according to a notice on the authority’s website. Bidders must be listed on the Hong Kong Stock Exchange with a market value of at least HK$40 billion ($5.2 billion) and annual sales of 20 billion yuan, it said. The companies must also sign cooperation memorandums with at least three foreign corporations on the Fortune 500 list before making the auction.
Excellence postponed a Hong Kong initial public offering that could have raised as much as $1 billion in 2009. The developer recorded 10.2 billion yuan of sales in 2012, according to the Morning Post, while the auction for the two sites was restricted to companies with an annual turnover of at least 10 billion yuan last year. Excellence beat out bids by a joint venture between China Vanke Co. and New World Development Co., Financial Street Holdings Co., China Resources Land Ltd., Greenland Group, Kaisa Group Holdings Ltd. and Shimao Property Holdings Ltd., the newspaper said.
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