CapitaLand agreed to sell part of its stakes in a portfolio of six shopping malls across China to Ping An Life Insurance for 46.7 billion yuan ($7.2 billion) as the Singapore-based real estate developer seeks to invest in high-growth new economy assets.
Following the divestment, CapitaLand said it will retain between 12.6% to 30% stakes in the Raffles City-branded shopping malls in Beijing, Chengdu, Hangzhou, Ningbo and Shanghai. It will also continue to provide asset management services for these properties and earn a fee income.
“We will build on the traction to further diversify CapitaLand’s investor base while continuing to maximize the property value and investment returns for our investors,” said Puah Tze Shyang, CEO for investment and portfolio management at CapitaLand China.
The transaction—expected to be completed in the third quarter of this year—will generate net proceeds of S$2 billion ($1.5 billion) for CapitaLand, the company said.
Proceeds from the divestment will support future investments into new economy assets such as business parks, logistics facilities and data centers, Puah said. CapitaLand aims to increase its exposure in these assets to S$5 billion in the next years from S$1.5 billion as of last year, he added.
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CapitaLand had raised S$11.2 billion from asset sales this year, more than three times the group’s annual target of S$3 billion. The real estate giant, which counts Singapore state investment arm Temasek Holdings as its biggest shareholder, owns and manages about S$137.7 billion worth of properties globally.