Greenland Group Signs MOU for $1 Bil Melbourne Residential Project

Greenland Melbourne Site

The twin sites straddle the Melbourne race track

Shanghai-based real estate developer Greenland Group kept itself busy over China’s National Day holiday, with the news getting out just two days after the break that it had signed a memorandum of understanding to purchase a pair of sites in downtown Melbourne for a new residential project.

In a statement last Wednesday, the Victoria Racing Club, confirmed that it had signed the MOU with Greenland Holding Group Overseas Investment Company — a division of state-owned Greenland Group.

With a potential investment of AU$1 billion (US$946 million) the Melbourne project was the smaller of Greenland’s two announced acquisitions during the week, with the company saying on Friday that it would buy a controlling interest in the US$4 billion Atlantic Yards project in Brooklyn.

Buying into Downtown Melbourne

Greenland’s Melbourne MOU is a step towards a final agreement for the developer to purchase two land parcels near the Flemington Race Course belonging to Melbourne’s Victory Racing Club. The smaller of the two parcels has an area of 10,500 square meters and the larger measure 30,174 square meters. The two sides expect to spend the next six months finalizing their agreements.

While still to be approved by government planners, individuals familiar with the transaction say that the site, which has been valued at AU$60 million, could yield up to 2000 apartments for sale.

In addition to the Atlantic Yards transaction, Greenland made headlines during July when it bought a site in Los Angeles to develop at US$1 billion project, and spent US$107.5 million during March this year to acquire a residential project in Sydney that it ultimately plans to spend US$498 million on.

Melbourne Deal Part of Chinese Overseas Buying Spree

While initially cautious about overseas investments, China’s real estate firms have become increasingly aggressive about overseas acquisitions during 2013.

Besides Greenland’s purchases in Australia and the US, billionaire Wang Jianlin’s Dalian Wanda Group is planning to invest billions of dollars in hotel projects in New York and London, China Vanke invested in a San Francisco residential development and CEO Zhang Xin of SOHO China was part of a consortium that purchased 40% of the $3.4 billion GM Building in New York.