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COMMERCIAL PROPERTY | Staff Reporter, Singapore

CapitaLand inks second mall management contract in Western China

It will manage the shopping mall in La Botanica, a township in Xi'an.

CapitaLand Mall Asia has signed its second management contract within a span of five months, leading to its management of the shopping mall in La Botanica, a township located in Xi’an’s Chan-Ba Ecological District that is being developed by CapitaLand-Henderson (Xi’an) Property Development Co. Ltd.

CapitaLand Mall Asia CEO Jason Leow said the group's asset-light expansion strategy through management contracts will continue to gather momentum with this deal in Xi’an.

“We are fast-tracking the growth of our shopping mall network in western China to capitalise on the region’s favourable economic prospects, which have been boosted by the Chinese government’s Western China Development Programme, One Belt, One Road economic initiative as well as the SinoSingapore Chongqing Connectivity Initiative," Leow noted.

He added that the deal would complement the group's core strategy of developing, owning and managing malls.

"By leveraging the expertise of our experienced team in western China to manage the mall in La Botanica, we will further benefit from the network effect of CapitaLand’s growing mall portfolio in the region and enjoy greater cost efficiencies in mall management.," Leow stated.

Under the contract, CapitaLand will oversee asset planning, pre-opening and retail management for a five-storey shopping mall – four levels above ground and one basement level – with a Gross Floor Area (GFA), excluding car park, of about 50,000 sqm. Expected to commence operations in 2019, the new mall will double CapitaLand’s retail presence in Xi’an, where it currently owns and manages CapitaMall Xindicheng, a 60,000 sq m one-stop shopping mall located near the prime Xiaozhai and Gaoxin areas, about 10km south of La Botanica.

Including the mall in La Botanica, CapitaLand now manages a portfolio of 14 shopping malls in western China with a combined retail GFA of about 1.13m sqm (12.1m sqft). The region is also home to two of CapitaLand’s flagship Raffles City integrated developments – Raffles City Chengdu, which opened in 2012; and Raffles City Chongqing, 2 Singapore’s single largest investment in China at RMB24b (about $5.0b) that will be opening in phases from 2018.

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