SHANGHAI, China: Japan's Rockefeller Group says it will direct the development of a choice property project near Shanghai's famous Bund waterfront neighborhood, part of a rush by foreign real estate companies into the commercial market despite efforts to cool prices.
The deal, announced Wednesday, involves construction of commercial and cultural buildings, serviced apartments and public spaces in an area now occupied by older housing near the city's Bund and Suzhou Creeks.
It will preserve famous historical buildings constructed in the 1920s and '30s, the Rockefeller Group said in a statement.
According to information posted on Rockefeller Group International's Web site, the project will also include several luxury hotels.
The Rockefeller Group's partner in the project is Shanghai New Huangpu Group, which is partly owned by the local district government.
The project also has backing from Sinolink Worldwide Holdings, a property and energy company with shares listed in Hong Kong whose chairman is Hunan-born tycoon Thomas Ou Yaping.
According to a statement by Sinolink on the Hong Kong Stock Exchange, the initial costs for the project, before construction begins, are US$169 million (euro144 million), to be financed mainly through share issues.
Plans call for Rockefeller to hold a 91 percent share in the joint venture, Shanghai Bund de Rockefeller Group, with the New Huangpu Group taking 9 percent, the notice said.
Rockefeller Group, a unit of Japan's Mitsubishi Estate Co., will hold control over planning and choice of architects, it said.
According to reports in China's state media, the project, first announced last year, was stalled by disagreements over resettlement of the densely populated old neighborhood and over the overall design for the district.
The deal, the first by the Rockefeller Group in China, is the latest of a spate of big projects announced by foreign property groups, despite recent government efforts to slow rising property prices to prevent what regulators say could become a "bubble.''
Such outside involvement in urban redevelopment is becoming increasingly common following the success of Shanghai's Xintiandi district, a cluster of historic buildings in downtown Shanghai renovated by tycoon Vincent Lo Hongshui, head of the Hong Kong-based Shui On Group, that is serving as a model for projects elsewhere in China. - AP