Rendering of Guo-Rui Square in Beijing
Despite an onslaught of scary headlines about Chinese real estate, at least one mainland property developer sees 2014 as a good time to start selling shares on Hong Kong’s stock market.
Beijing-based Guorui Properties Ltd is hoping to raise $242.4 million from buyers who still want a piece of China’s real estate market when it lists on July 7th. And according to a story in the Wall Street Journal, the 13-year-old developer has already signed up cornerstone investors willing to hand over $92 million to get in on this deal.
Guo Rui, which has developed almost exclusively in Beijing, has built an array of projects across the residential, office and retail sectors, including the 600,000 square metre Foster+Partners designed Guo-Rui Square project, the Sanlitun Village shopping mall, and the Spring Town residential project.
The IPO consists of 662 million shares, which have been indicated to be priced at between HK$2.30 and HK$2.84 ($0.30 to $0.37) per share. Companies which have already committed as cornerstone investors reportedly include Beijing No. 5 Construction Engineering and Sino Biopharmaceutical Ltd. The company is said to be planning to put the proceeds of its IPO into developing more real estate projects.
According to information in the IPO file, Guorui’s Chairman Zhang Zhangsun holds 3.7 billion shares of the company, and if the IPO achieves the desired results, Zhang would become China’s latest real estate billionaire, grossing up to $1.4 billion from the share sale.
More Listings on the Way
In addition to Guorui’s IPO, China hotel trust Jinmao Investments and Jinmao (China) Investments Holdings, recently started taking orders for its own $437 million IPO in Hong Kong, and Yida China Holdings, the developer of the successful chain of Dalian Software Park (DLSP) projects across China is planning a listing that might bring in as much as HK$1.7 billion ($219 million).
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