Forchn Holdings boss Zhang Guobiao is taking his warehouse business regional
Chinese manufacturer and warehouse developer Forchn Holdings has signed a framework agreement with Singaporean logistics provider YCH Group to cooperate on investments in Southeast Asia and China including establishing a $150 million warehouse fund.
“The partnership with YCH Group is a key milestone for Forchn Holdings as we continue to expand beyond China through our overseas headquarters, Forchn International in Singapore,” Forchn chairman Zhang Guobiao, said in a statement. Zhang, whose company co-founded mainland logistics provider Cainiao with Alibaba Group in 2013, said that the collaboration with YCH, “cements Forchn’s position as a leading logistics real estate investor and ecommerce logistics services provider along the BRI.”
EC World REIT Gets Access to SE Asia Assets
Under the partnership, Forchn-sponsored EC World REIT, which controls seven logistics assets in China, will gain an exclusive opportunity to purchase 13 logistics real estate assets from YCH, which operates in 16 countries around the region. The assets being made available to EC World REIT cover a total gross floor area of over 280,000 square meters and have an estimated value of S$400 million, according to an announcement to the Singapore Exchange by the listed trust. The REIT’s total assets were listed at S$1.5 billion at the end of 2017.
Should the potential acquisition be completed, YCH would lease and operate these logistic assets, as well as obtaining a stake in EC World REIT and seats on the trust’s board. Forchn successfully listed EC World REIT on the Singapore exchange in 2016.
Last week’s framework agreement follows the February signing of a Memorandum of Understanding between Forchn and YCH regarding the potential cooperation.
Partners Plan $150M Belt and Road Logistics Fund
YCH opened its Supply Chain City facility in Singapore last year
The framework agreement also sets the table for EC World, which previously only held assets in China, to join mainland competitors such as e-Shang Redwood and Logos Property in targetting logistics acquisitions in Southeast Asia.
Under the terms of the deal the new partners plan to launch a $150 million fund for investing in logistics properties in Southeast Asia and China, according to an announcement by YCH. The two parties posed their initiative as in close alignment with China’s loosely defined Belt and Road plan. YCH last year opened what it says is Southeast Asia’s largest and tallest automated storage retrieval system at its Supply Chain City facility in Singapore’s Jurong West and has invested heavily in modernising its logistics facilities.
Shanghai-based Forchn currently operates 700,000 square meters of developed logistics projects and, under its Ruyicang smart warehousing service, has won e-commerce giants including Alibaba Group and Vipshop Holdings as clients.
The company, which has over 20 years track record of operating logistics facilities in mainland China, holds a 42 percent stake in EC World REIT.
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