In a break from its traditional lease-only approach to commercial property development, Japan’s Mori Group, the developer of China’s tallest building , the Shanghai World Financial Center (SWFC), has decided to sell space in the building on a strata basis.
The 492 meter high skyscraper has been plagued with a high vacancy rate since it started to canvass for clients after completing the project in August 2008. After wading through the financial crisis, the iconic building was able to raise its occupancy rate to more than 70 percent, according to company statements.
The company contends that its decision to sell off the building piece by piece is in response to market demand. “Since the completion of our building, we have received many enquiries from our clients to buy office space for their own use, and the latest deal is at the call of such requirement,” said a public relations officer from the Mori Building.
According to Xue Jianxiong, an analyst from the China Real Estate Information Corporation, the deal between Mori Group and Tomson has a lot to do with financial pressure for new investment. The total investment in the building is 8.3 billion yuan, and if the Mori Group sells fewer than 40 of its more than 60 office floors, the company will recover all its costs, Xue added. Shares of Tomson Group dipped 3.24 percent to 2.99 yuan on the Hong Kong Stock Exchange on Thursday.
From China Daily
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