Forterra Trust (formerly: Treasury China Trust)

[HitandRun]

Will the orang kaya who grab 171 lots at closing own up and share with us your plans?

[KopiKat]

Will the orang kaya who grab 171 lots at closing own up and share with us your plans?

I gladly shared the extra ones I got recently with orang kaya(s) who are using CP '78' - Merrill Lynch at closing. Others before closing, '08' - Credit Suisse & '70' - CLSA appears to be involved in this exercise...

[Boon]

The location where the HQ is located cannot be compared to SHKP's Xujiahui property. The former is more suburban , the latter in a prime shopping area.

Hi MINX,
1) The HQ is located in the “Hongqiao CBD” (HQCBD) which is about 4 km away from Xujiahui centre “XJH”– about 10 minutes by taxi
2) “HQCBD” is part of Shanghai CBD – the western part of Shanghai CBD
3) As to which is “more suburban” than the other – it is debatable. If “more suburban” = “less prime in retail” then I would agree.
4) “HQCBD” used to be the high end prime shopping area in Shanghai before shopping areas emerged in XJH and other parts of Shanghai – see historical development of “HQCBD” below.
5) Please note that SHKP’s site is for mixed-use development – with hotel, office and retail
6) Hotel rates (and hence capital values) of similar standard hotels in both areas are comparable IMO.
7) Office rents (and hence capital values) of similar grade offices in both areas are comparable IMO.
8) In Shanghai, the major retail/shopping areas are:
- Nanjing Road East (NJE) : Primary
- Nanjing Road West (NJW) : Primary
- Huaihai Road Middle (HHM) : Primary
- Xujiahui (XJH) : Primary
- Lujiazui (LJZ) : Primary
- Zhongshan Park (ZSP) : Secondary
- Wujiaochang (WJC) : Secondary
- Sichuan Road North (SCN) : Secondary
- Hongqiao CBD (HQCBD) : Secondary
9) No doubt, XJH is considered prime retail area of Shanghai and therefore retail rents in Xujiahui are higher than in “Hongqiao CBD”– but “Hongqiao CBD” is not far behind - The gap is closing with the opening of L’ Avenue. IMO, after the completion of the HQ, Shanghai Arch Walk and SOHO Tianshan project, and the underground links to the subway line, this shopping strip could rival that in XJH.
10) In short, the difference in capital values of mixed-use assets of similar grade (with typical average mix) on per square meter basis between the two areas should not be that big IMO – this is the point I am driving at.
_____________________________________________________________________________________________________________________________________________

Renaissance For Shanghai’s Hongqiao CBD?
February 14th, 2013 by Evian Zhu (JLL)

Recent years have seen maturing urban infrastructure combine with strong office and retail demand to give rise to new commercial clusters along the periphery of Shanghai’s city centre. One of the most prominent emerging areas is Hongqiao, which has a unique history. Hongqiao, previously an important office and retail area in Shanghai, faded from prominence in the 1990s, but today returns stronger than ever. New developments are restoring Hongqiao to its former prominence.
Once a rural area in western Shanghai, Hongqiao was designated as a state-level development zone in 1986. Authorities took advantage of the zone’s location between Hongqiao Airport (Shanghai’s only international airport at the time) and Shanghai’s traditional centre to develop a commercial hub with exhibition space, offices, hotels, and diplomatic facilities. The 1990s saw a wave of development that cemented Hongqiao’s rise as one of Shanghai’s key early business districts. More than ten office towers were built, and the zone attracted a range of multinational companies like 3M, Chrysler, GE, and LG. In addition, at least half a dozen foreign consulates were established in the area. Hongqiao’s Friendship Department Store opened in 1994 and became the most high-end retail property in Shanghai, with international brands and imported products. As other areas like Lujiazui (the financial district) and Xujiahui (in the southwest) took centre stage in the late 1990s and early 2000s, demand and supply in Hongqiao’s office and retail sectors declined, and Hongqiao’s brightness began to fade (see chart below). The turning point came in 1999 when Pudong International airport, 60 km east, took over all international flights to Shanghai.
Hongqiao is experiencing a surge of construction of prime office and retail space that is giving it a new lease on life. Notable new mixed-use projects include L’avenue by LVMH, The HQ (Shanghai City Centre) by Treasury Holdings, GIFC Phase II (Takashimaya) by Gubei Group, Jin Hongqiao by APP and SOHO’s Tianshan Road Project. All of these have just completed or will complete within the next three years, doubling the retail stock of the area. We reclassified Hongqiao from a decentralised area to a part of Shanghai’s CBD in 2011, due to the comprehensive upgrade of the area’s business environment. For example, L’avenue will be home to the first Louis Vuitton and Tod’s stores in west Shanghai. Meanwhile, the commitment rate of GIFC Phase II’s office portion (70,000 sqm) has already exceeded 60%, higher than the average of other CBD projects that delivered in the same quarter.
Hongqiao’s profile will be further boosted by the rising prominence of the west Shanghai region, which is underpinned by the new Hongqiao Transportation Hub, including a hugely expanded airport. Tenants are attracted to Hongqiao for its new properties, strong government support, and large, wealthy population base. As a result, we expect that Hongqiao’s rental performance will remain sound and will experience stronger rental growth than most areas in Shanghai.

http://www.joneslanglasalleblog.com/APRe...jw4njmS3IV
__________________________________________________________________________________________________________________________________________

“In Hongqiao, there has been a major transition in recent months. Two new commercial zones are beginning to emerge: a high-end area around L’Avenue, The HQ’ and the upgraded Hongqiao Friendship Store; and a mid-market area on Tianshan Road, centered around the Huijin Department Store, Parkson Hongqiao store and the nearby Hongqiao Tiandu....................................

A significant amount of activity is forecast in the coming quarters for the Hongqiao area. District government plans call for the linking of Zunyi Road’s underground corridor with The HQ, L’Avenue and an upgrade of the Hongqiao Friendship Store. The three projects combined will form an emerging center for high-end shopping. A second, mid-market commercial hub is also forming nearby, centered around the Huijin Department Store, Parkson Hongqiao store and the nearby Hongqiao Tiandu”.

http://www.colliers.com/en-GB/China/~/me...-2012.ashx

____________________________________________________________________________________________________________________________________________

Shanghai’s retail property market landscape will continue to evolve, with a burgeoning retail precinct in the Hongqiao area. The effects of brand clustering and the reputation of LVMH, an owner of L’Avenue, are expected to attract new retail tenants to the area and promote the overall positioning of Hongqiao retail market. Together with the launch of Shanghai Arch Walk and the HQ in 2014, the retail ambience of this neighborhood will be enhanced, rendering a positive financial outlook for the retail assets.

See page 4 of https://s3-ap-southeast-1.amazonaws.com/...02972b.pdf

L' Avenue is opened
http://maosuit.com/real-estate/lvmh-open...-shanghai/
http://www.lavenue-shanghai.com/en/

(Vested)

[freedom]

Xujiahui is the retail district, something like Orchard/Bugis, Hongqiao is the new transport hub(airport/high speed train, etc), much like Changi.

[HitandRun]

Ah.... KopiKat san

Are you THE orang kaya? Chin chai chin chai give some tips leh. What's the game plan next week?

Meanwhile to all those folks who talking down the property assets. Seriously, I agree 100% man. Don't know why property valuation anyhow do, and auditor anyhow audit and this dumb Nan Fong anyhow pay 3 bucks for something that is like worthless! Don't they even do their homework?!

You would have thought that someone as rich as Nan Fong, will have more sense and pay more like Sun Hung Kai, 37,264 per sqm for a raw piece of land rather than suka suka paying much less than book value (which is <33,000 per sqm) for a distressed asset. C'mon man, we need Nan Fong to show that they've really got the dough, what business do they have trying to pick up bargains?

When a person is filthy rich, shouldn't he just splash his money all round and make everyone happy?

[MINX]

The location where the HQ is located cannot be compared to SHKP's Xujiahui property. The former is more suburban , the latter in a prime shopping area.

Hi MINX,
1) The HQ is located in the “Hongqiao CBD” (HQCBD) which is about 4 km away from Xujiahui centre “XJH”– about 10 minutes by taxi
2) “HQCBD” is part of Shanghai CBD – the western part of Shanghai CBD
3) As to which is “more suburban” than the other – it is debatable. If “more suburban” = “less prime in retail” then I would agree.
4) “HQCBD” used to be the high end prime shopping area in Shanghai before shopping areas emerged in XJH and other parts of Shanghai – see historical development of “HQCBD” below.
5) Please note that SHKP’s site is for mixed-use development – with hotel, office and retail
6) Hotel rates (and hence capital values) of similar standard hotels in both areas are comparable IMO.
7) Office rents (and hence capital values) of similar grade offices in both areas are comparable IMO.
8) In Shanghai, the major retail/shopping areas are:
- Nanjing Road East (NJE) : Primary
- Nanjing Road West (NJW) : Primary
- Huaihai Road Middle (HHM) : Primary
- Xujiahui (XJH) : Primary
- Lujiazui (LJZ) : Primary
- Zhongshan Park (ZSP) : Secondary
- Wujiaochang (WJC) : Secondary
- Sichuan Road North (SCN) : Secondary
- Hongqiao CBD (HQCBD) : Secondary
9) No doubt, XJH is considered prime retail area of Shanghai and therefore retail rents in Xujiahui are higher than in “Hongqiao CBD”– but “Hongqiao CBD” is not far behind - The gap is closing with the opening of L’ Avenue. IMO, after the completion of the HQ, Shanghai Arch Walk and SOHO Tianshan project, and the underground links to the subway line, this shopping strip could rival that in XJH.
10) In short, the difference in capital values of mixed-use assets of similar grade (with typical average mix) on per square meter basis between the two areas should not be that big IMO – this is the point I am driving at.
_____________________________________________________________________________________________________________________________________________

Renaissance For Shanghai’s Hongqiao CBD?
February 14th, 2013 by Evian Zhu (JLL)

Recent years have seen maturing urban infrastructure combine with strong office and retail demand to give rise to new commercial clusters along the periphery of Shanghai’s city centre. One of the most prominent emerging areas is Hongqiao, which has a unique history. Hongqiao, previously an important office and retail area in Shanghai, faded from prominence in the 1990s, but today returns stronger than ever. New developments are restoring Hongqiao to its former prominence.
Once a rural area in western Shanghai, Hongqiao was designated as a state-level development zone in 1986. Authorities took advantage of the zone’s location between Hongqiao Airport (Shanghai’s only international airport at the time) and Shanghai’s traditional centre to develop a commercial hub with exhibition space, offices, hotels, and diplomatic facilities. The 1990s saw a wave of development that cemented Hongqiao’s rise as one of Shanghai’s key early business districts. More than ten office towers were built, and the zone attracted a range of multinational companies like 3M, Chrysler, GE, and LG. In addition, at least half a dozen foreign consulates were established in the area. Hongqiao’s Friendship Department Store opened in 1994 and became the most high-end retail property in Shanghai, with international brands and imported products. As other areas like Lujiazui (the financial district) and Xujiahui (in the southwest) took centre stage in the late 1990s and early 2000s, demand and supply in Hongqiao’s office and retail sectors declined, and Hongqiao’s brightness began to fade (see chart below). The turning point came in 1999 when Pudong International airport, 60 km east, took over all international flights to Shanghai.
Hongqiao is experiencing a surge of construction of prime office and retail space that is giving it a new lease on life. Notable new mixed-use projects include L’avenue by LVMH, The HQ (Shanghai City Centre) by Treasury Holdings, GIFC Phase II (Takashimaya) by Gubei Group, Jin Hongqiao by APP and SOHO’s Tianshan Road Project. All of these have just completed or will complete within the next three years, doubling the retail stock of the area. We reclassified Hongqiao from a decentralised area to a part of Shanghai’s CBD in 2011, due to the comprehensive upgrade of the area’s business environment. For example, L’avenue will be home to the first Louis Vuitton and Tod’s stores in west Shanghai. Meanwhile, the commitment rate of GIFC Phase II’s office portion (70,000 sqm) has already exceeded 60%, higher than the average of other CBD projects that delivered in the same quarter.
Hongqiao’s profile will be further boosted by the rising prominence of the west Shanghai region, which is underpinned by the new Hongqiao Transportation Hub, including a hugely expanded airport. Tenants are attracted to Hongqiao for its new properties, strong government support, and large, wealthy population base. As a result, we expect that Hongqiao’s rental performance will remain sound and will experience stronger rental growth than most areas in Shanghai.

http://www.joneslanglasalleblog.com/APRe...jw4njmS3IV
__________________________________________________________________________________________________________________________________________

“In Hongqiao, there has been a major transition in recent months. Two new commercial zones are beginning to emerge: a high-end area around L’Avenue, The HQ’ and the upgraded Hongqiao Friendship Store; and a mid-market area on Tianshan Road, centered around the Huijin Department Store, Parkson Hongqiao store and the nearby Hongqiao Tiandu....................................

A significant amount of activity is forecast in the coming quarters for the Hongqiao area. District government plans call for the linking of Zunyi Road’s underground corridor with The HQ, L’Avenue and an upgrade of the Hongqiao Friendship Store. The three projects combined will form an emerging center for high-end shopping. A second, mid-market commercial hub is also forming nearby, centered around the Huijin Department Store, Parkson Hongqiao store and the nearby Hongqiao Tiandu”.

http://www.colliers.com/en-GB/China/~/me...-2012.ashx

____________________________________________________________________________________________________________________________________________

Shanghai’s retail property market landscape will continue to evolve, with a burgeoning retail precinct in the Hongqiao area. The effects of brand clustering and the reputation of LVMH, an owner of L’Avenue, are expected to attract new retail tenants to the area and promote the overall positioning of Hongqiao retail market. Together with the launch of Shanghai Arch Walk and the HQ in 2014, the retail ambience of this neighborhood will be enhanced, rendering a positive financial outlook for the retail assets.

See page 4 of https://s3-ap-southeast-1.amazonaws.com/...02972b.pdf

L' Avenue is opened
http://maosuit.com/real-estate/lvmh-open...-shanghai/
http://www.lavenue-shanghai.com/en/

(Vested)

Hi Boon,
Xujiahui is a well established prime retail area in Shanghai, Hongqiao is a "has been" area in a not so central locality. There is a discernible difference between properties located in these 2 areas. However, i do take your point that there have been new developments in the area which could revive it's potential, but even so, it is unlikely to unseat Xujiahui simply because it is located more in the suburbs.

[Boon]

Is that $48m really unencumbered cash? Maybe they need it to pay for the HQ completion.

On page 6 of 2013Q2 results: “As at 30 June 2013 the Trust had total cash holdings equating to S$193.87 million, of which 9.42% was held onshore in China in RMB”

On page 8, table 1c : “ SGD (177 – 65) = SGD 112 million as at 30 June 2013 was needed to complete the HQ extension.”

Hence there is enough cash (offshore – out of China) to distribute as dividend to unit-holders for FY2013.

Regardless of the “ultimate real motive” of the new controlling shareholder, Nanfung – IMO, there is every justification to make distribution to unit-holders for FY2013 and beyond.

[opmi]

another question: How to move the onshore money to offshore to pay off unit-holders?

[Boon]

another question: How to move the onshore money to offshore to pay off unit-holders?

Hi opmi,

9.42% of the SGD 193.87 million is "onshore" in China, the rest 90.58% is not in China (offshore) - sale of Central Plaza was conducted "offshore" in HK.

As a matter of fact, loan facilities for the HQ Extension had been obtained prior to the sale of Central Plaza - Forterra has the option of contintuing to drawdown on this loan to complete the project.

---

The location where the HQ is located cannot be compared to SHKP's Xujiahui property. The former is more suburban , the latter in a prime shopping area.

Hi MINX,
1) The HQ is located in the “Hongqiao CBD” (HQCBD) which is about 4 km away from Xujiahui centre “XJH”– about 10 minutes by taxi
2) “HQCBD” is part of Shanghai CBD – the western part of Shanghai CBD
3) As to which is “more suburban” than the other – it is debatable. If “more suburban” = “less prime in retail” then I would agree.
4) “HQCBD” used to be the high end prime shopping area in Shanghai before shopping areas emerged in XJH and other parts of Shanghai – see historical development of “HQCBD” below.
5) Please note that SHKP’s site is for mixed-use development – with hotel, office and retail
6) Hotel rates (and hence capital values) of similar standard hotels in both areas are comparable IMO.
7) Office rents (and hence capital values) of similar grade offices in both areas are comparable IMO.
8) In Shanghai, the major retail/shopping areas are:
- Nanjing Road East (NJE) : Primary
- Nanjing Road West (NJW) : Primary
- Huaihai Road Middle (HHM) : Primary
- Xujiahui (XJH) : Primary
- Lujiazui (LJZ) : Primary
- Zhongshan Park (ZSP) : Secondary
- Wujiaochang (WJC) : Secondary
- Sichuan Road North (SCN) : Secondary
- Hongqiao CBD (HQCBD) : Secondary
9) No doubt, XJH is considered prime retail area of Shanghai and therefore retail rents in Xujiahui are higher than in “Hongqiao CBD”– but “Hongqiao CBD” is not far behind - The gap is closing with the opening of L’ Avenue. IMO, after the completion of the HQ, Shanghai Arch Walk and SOHO Tianshan project, and the underground links to the subway line, this shopping strip could rival that in XJH.
10) In short, the difference in capital values of mixed-use assets of similar grade (with typical average mix) on per square meter basis between the two areas should not be that big IMO – this is the point I am driving at.
_____________________________________________________________________________________________________________________________________________

Renaissance For Shanghai’s Hongqiao CBD?
February 14th, 2013 by Evian Zhu (JLL)

Recent years have seen maturing urban infrastructure combine with strong office and retail demand to give rise to new commercial clusters along the periphery of Shanghai’s city centre. One of the most prominent emerging areas is Hongqiao, which has a unique history. Hongqiao, previously an important office and retail area in Shanghai, faded from prominence in the 1990s, but today returns stronger than ever. New developments are restoring Hongqiao to its former prominence.
Once a rural area in western Shanghai, Hongqiao was designated as a state-level development zone in 1986. Authorities took advantage of the zone’s location between Hongqiao Airport (Shanghai’s only international airport at the time) and Shanghai’s traditional centre to develop a commercial hub with exhibition space, offices, hotels, and diplomatic facilities. The 1990s saw a wave of development that cemented Hongqiao’s rise as one of Shanghai’s key early business districts. More than ten office towers were built, and the zone attracted a range of multinational companies like 3M, Chrysler, GE, and LG. In addition, at least half a dozen foreign consulates were established in the area. Hongqiao’s Friendship Department Store opened in 1994 and became the most high-end retail property in Shanghai, with international brands and imported products. As other areas like Lujiazui (the financial district) and Xujiahui (in the southwest) took centre stage in the late 1990s and early 2000s, demand and supply in Hongqiao’s office and retail sectors declined, and Hongqiao’s brightness began to fade (see chart below). The turning point came in 1999 when Pudong International airport, 60 km east, took over all international flights to Shanghai.
Hongqiao is experiencing a surge of construction of prime office and retail space that is giving it a new lease on life. Notable new mixed-use projects include L’avenue by LVMH, The HQ (Shanghai City Centre) by Treasury Holdings, GIFC Phase II (Takashimaya) by Gubei Group, Jin Hongqiao by APP and SOHO’s Tianshan Road Project. All of these have just completed or will complete within the next three years, doubling the retail stock of the area. We reclassified Hongqiao from a decentralised area to a part of Shanghai’s CBD in 2011, due to the comprehensive upgrade of the area’s business environment. For example, L’avenue will be home to the first Louis Vuitton and Tod’s stores in west Shanghai. Meanwhile, the commitment rate of GIFC Phase II’s office portion (70,000 sqm) has already exceeded 60%, higher than the average of other CBD projects that delivered in the same quarter.
Hongqiao’s profile will be further boosted by the rising prominence of the west Shanghai region, which is underpinned by the new Hongqiao Transportation Hub, including a hugely expanded airport. Tenants are attracted to Hongqiao for its new properties, strong government support, and large, wealthy population base. As a result, we expect that Hongqiao’s rental performance will remain sound and will experience stronger rental growth than most areas in Shanghai.

http://www.joneslanglasalleblog.com/APRe...jw4njmS3IV
__________________________________________________________________________________________________________________________________________

“In Hongqiao, there has been a major transition in recent months. Two new commercial zones are beginning to emerge: a high-end area around L’Avenue, The HQ’ and the upgraded Hongqiao Friendship Store; and a mid-market area on Tianshan Road, centered around the Huijin Department Store, Parkson Hongqiao store and the nearby Hongqiao Tiandu....................................

A significant amount of activity is forecast in the coming quarters for the Hongqiao area. District government plans call for the linking of Zunyi Road’s underground corridor with The HQ, L’Avenue and an upgrade of the Hongqiao Friendship Store. The three projects combined will form an emerging center for high-end shopping. A second, mid-market commercial hub is also forming nearby, centered around the Huijin Department Store, Parkson Hongqiao store and the nearby Hongqiao Tiandu”.

http://www.colliers.com/en-GB/China/~/me...-2012.ashx

____________________________________________________________________________________________________________________________________________

Shanghai’s retail property market landscape will continue to evolve, with a burgeoning retail precinct in the Hongqiao area. The effects of brand clustering and the reputation of LVMH, an owner of L’Avenue, are expected to attract new retail tenants to the area and promote the overall positioning of Hongqiao retail market. Together with the launch of Shanghai Arch Walk and the HQ in 2014, the retail ambience of this neighborhood will be enhanced, rendering a positive financial outlook for the retail assets.

See page 4 of https://s3-ap-southeast-1.amazonaws.com/...02972b.pdf

L' Avenue is opened
http://maosuit.com/real-estate/lvmh-open...-shanghai/
http://www.lavenue-shanghai.com/en/

(Vested)

Hi Boon,
Xujiahui is a well established prime retail area in Shanghai, Hongqiao is a "has been" area in a not so central locality. There is a discernible difference between properties located in these 2 areas. However, i do take your point that there have been new developments in the area which could revive it's potential, but even so, it is unlikely to unseat Xujiahui simply because it is located more in the suburbs.

Hi MINX,

Interesting perceptions.

What's your take on the following:

Between “Orchard Road Area” and “Raffles Place Area”, in Singapore

1) Which do you think is more “centrally located” than the other?

2) Which do you think is more “suburban” than the other?

[freedom]

Is "Raffles Place" area Luijazui in Shanghai?