Mingtiandi

Asia real estate and outbound investment news

  • Facebook
  • LinkedIn
  • RSS
  • Twitter
Sign Up / Login Logout

Lost your password?
Register
Forgotten Password
Cancel

Register For This Site

A password will be e-mailed to you.

  • Capital Markets
  • Events
    • Mingtiandi 2022 Event Calendar
    • APAC Residential Forum 2022
    • Asia Logistics Forum 2022
    • Asian Capital in Australia Forum 2022
    • Asia REIT Forum 2022
    • APAC Data Centre Forum 2022
    • Singapore Focus Forum 2022
    • Office Strategies Forum 2022
    • More Events
  • MTD TV
  • People
  • Logistics
  • Data Centres
  • Asia Outbound
  • Retail
  • Research & Policy
  • Advertise

Soho China Confirms Buyout Talks Following Report of $4B Blackstone Offer

2020/03/12 by Michael Cole Leave a Comment

galaxy soho

Galaxy Soho in Beijing is one of the stars of the portfolio

Mainland commercial developer Soho China has confirmed that it is considering buyout offers for the Hong Kong listed firm, just two days after news reports indicated that it had entered into exclusive discussions with Blackstone.

In an announcement to the Hong Kong stock exchange, the Beijing-based developer said that, “the Company has been in discussions with overseas financial investors to explore the possibility of a strategic partnership (the “Potential Transaction”), which may or may not lead to a general offer for the issued share capital of the Company (“Shares”).”

The company, which is led by husband and wife team Zhang Xin and Pan Shiyi, cautioned that no decision had been made to proceed with the potential sale, which reports indicate would be worth over HK$31 billion ($4 billion). Soho’s announcement did not mention Blackstone by name, and the US fund management giant has thus far declined to comment on the reported deal.

Blackstone’s Biggest China Bet

Following the announcement last night, trading in Soho’s shared recommenced today after having been halted on Tuesday after the news of the potential buyout had first been reported by Reuters.

zhang xin soho

Soho CEO Zhang Xin seems to be thinking it over

Blackstone is said to be offering HK$6 per share to take Soho China private – a more than 100 percent premium over what the company’s stock had traded for on Monday of this week. Shares in Soho closed at HK$4.10 today.

Should the buyout of the office developer proceed, it would be Blackstone’s biggest investment ever in China’s real estate sector – an industry where the company has previously invested billions of dollars in residential, retail and logistics developers, as well as making numerous trades of single assets.

In 2013 the private equity firm led by financier Stephen Schwarzman had spent a reported $400 million to acquire a 40 percent stake in SZITIC Commercial Property Co, a mall developer better known as SCP. After building out a development portfolio of shopping centres, in 2016 Blackstone sold off its interest in SCP to a consortium led by mainland developer China Vanke for $1.9 billion.

Buying a First Tier Office Portfolio

Soho China was first reported to be looking for a major exit in October of last year, well before the coronavirus hobbled the mainland economy, with Blackstone mentioned at the time as a leading candidate to buy an $8.6 billion portfolio of commercial assets from the Beijing-based developer.

REIT forum 2022_250 ad

The buyout is also reported to involve Blackstone taking over Soho China’s debt, which totalled RMB 32.68 billion ($4.70 billion) at the end of June last year, according to the developer’s interim report.

Soho has a portfolio of eight investment properties in its portfolio, with four office buildings each in Shanghai and Beijing. Known for commissioning high profile architects such as Zaha Hadid for projects built grade A, if not prime office projects, Soho’s office assets total 825,851 square metres (8.9 million square feet) according to the company’s most recent annual report.

Developer for Hire

Having shifted to a “build to hold” strategy in 2012, Soho has struggled to make money from rental income, and has enjoyed greater success from selling completed office buildings to investment funds.

Logistics forum 2022 Web banner

In 2018 the developer sold two buildings in its Sky Soho project in Shanghai’s Hongqiao area to Gaw Capital for $798 million, after having sold a 100,000 square metre piece of that complex to Chinese travel portal C-Trip in 2013.

The developer had sold its Soho Hongkou project to a consortium including Keppel Land China, Alpha Investment Partners and Allianz Insurance for RMB 3.6 billion in 2017.

Share this now

  • LinkedIn
  • Share
  • Tweet
  • Email

Filed Under: Finance Tagged With: Blackstone, cm-ml, daily-sp, Featured, highlight, SOHO China

Leave a Reply

Your email address will not be published. Required fields are marked *

Get Mingtiandi Delivered

MTD TV

Asia Real Estate Takes Aim at Net Zero: MTD TV

MTD TV data centre panel

Blackstone, Actis Predict Continued Growth for APAC Data Centres on MTD TV

More MTD TV Videos

Latest Stories

kenny lam manulife

Link REIT Hiring Outgoing Manulife IM Exec Kenny Lam as Co-CIO

kuok khoon hua

China Resources Logistics Adds Fifth HK Industrial Asset in Two Years

Amelie-Delaunay

GLP Leads Real Estate Fund Managers in APAC, Bumps CapitaLand From Global Top 10

Sponsored Features

Rosanna Tang Colliers

Office Upgrades Jump After Omicron Slowed Hong Kong Market in Q1 Sponsored Feature

Bernie Devine

Is Your Building a Device? Sponsored Feature

Vietnam’s BW Acquires First Assets in Long An Province as Growth Continues Sponsored Feature

More Sponsored Features>>

MTD-QR-Code-320

Connect with Mingtiandi

  • Facebook
  • LinkedIn
  • RSS
  • Twitter

Real Estate News

  • Capital Markets
  • 2022 Event Calendar
  • MTD TV Archives
  • People
  • Logistics
  • Data Centres
  • Asia Outbound
  • Retail

More Mingtiandi

  • About Mingtiandi
  • Contact Mingtiandi
  • Mingtiandi Membership
  • Newsletter Subscription
  • Advertise
  • Terms of Use
  • Privacy
  • Join the Mingtiandi Team


© 2007-2022 China Advertising Media Ltd (Samoa). All rights reserved.