First Sponsor enters JV to develop Guangdong mixed-use property

Wanjiang Victory Land comprises three adjacent plots with a total site area of approximately 42,343.4 sqm.

First Sponsor Group’s wholly-owned Guangdong has entered into a joint venture agreement (JVA) with Chinese real estate property developer and operator Poly Bay Area Investment Development Co. and Shoucheng (Dongguan) Real Estate Co. (SDRE) to jointly develop Wanjiang Victory Land for residential and commercial use.

Wanjiang Victory Land comprises three adjacent plots of mixed-use development land situated in the southeast of Wanjiang District, Victory Community in Dongguan, Guangdong province. It has a total site area of approximately 42,343.4 sqm and a total gross floor area (GFA) of approximately 214,739 sqm, which comprises approximately 133,764 sqm of residential GFA and approximately 80,975 sqm of commercial GFA.

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“The residential component has a leasehold tenure of 70 years and the commercial component has a leasehold tenure of 40 years,” First Sponsor noted, adding that Wanjiang Victory Land is held by JVCo and was acquired for a purchase price of approximately $592m (RMB3b).

The investment in Wanjiang Victory Land is said to be in line with the group’s strategy to expand its footprint in Dongguan to leverage on the potential of the Greater Bay Area (GBA). The joint venture will also enable the First Sponsor to leverage on the expertise and experience of Poly Developments and Holdings in the development and management of a large scale mixed-use development.

Also read: First Sponsor Group to undertake rights issue for $399.5m

Poly Bay Area, First Sponsor Guangdong and SDRE have contributed cash amounts to the registered capital of JVCo of $207.2m, $79.9m and $8.9m, respectively. This is in proportion to the equity interests which they have respectively agreed to subscribe for under the JVA at 70%, 27% and 3%. Following the capital contributions, JVCo has become an associated company of First Sponsor.

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