Landsea Green Properties Develops Nanjing Project with Shanghai Construction Group, Pingan Real Estate and China Merchants Property Development
To Undertake Professional Services for Hefei Project and Realizes Asset-light Strategy and Profit-diversification Strategy

Hong Kong, January 21, 2015 – Landsea Green Properties Co., Ltd., (“Landsea Green Properties” or “the Company”, stock code: 00106), China’s leading property developer and operator with green technology, today announced that the Company will set up a project company with three parties - including Shanghai Construction Group Co., Ltd. (“Shanghai Construction Group”), Pingan Real Estate Company Limited (“Pingan Real Estate”), and China Merchants Property Development Co., Ltd. (“China Merchants Property Development”) - to jointly develop a project involving a parcel of land in the Hexi CBD area of Nanjing (the “Hexi CBD Land Parcel”). The Company will charge management service fees and sales service fees for its involvement in the project. Also, the Company has been entrusted by Hefei Hualun Culture Industry Investment Company Limited (“Hefei Hualun”) to provide development and construction management services, as well as other services, for a project in Hefei.

Cooperation with Shanghai Construction Group, Pingan Real Estate and China Merchants Property Development for Development of Premium Green Technology Residences

The Company signed a cooperation agreement with Shanghai Construction Group, Pingan Real Estate and China Merchants Property Development to set up a project company for the joint development of the Hexi CBD Land Parcel, with equity interest in the Project Company of 12.97%, 51%, 30%, and 6.03%, respectively.

The Hexi CBD Land Parcel is near the venue which hosted the Nanjing Youth Olympic Games and is in a high-end residential area of Nanjing. The project covers a site area of approximately 81,561 square meters and has a plot ratio of 2.75. The expected total gross floor area could reach 224,293 square meters. With a land purchase price of RMB3.1 billion, the estimated total investment will amount to approximately RMB5.5 billion. The designated use of the Hexi CBD Land Parcel falls in the type two residential category. The Company is in charge of the development, and the expected total gross floor area could reach 153,083 square meters. The project aims to provide a green technology residence which is widely sought in the Nanjing market, and which is expected to bring considerable income.

Provision of Management and Green Building Technology Services for Hefei Project

Separately, the Company and Hefei Hualun entered into an entrusted project development entrusted management and green building technology services framework agreement involving a project in Hefei. Citing the Company’s experience in the real estate sector and its professional technical capability, trading ability and brand strength in the development of green property projects, Hefei Hualun has entrusted the Company to provide residential green technology services comprising construction management and cooperation management. The services will leverage the Company’s management and technical services, brand recognition, and trademark licensing, and the project will be constructed to meet the three-star green building standard adopted by the Ministry of Construction.

Landsea Green Properties will charge entrusted development fees of not less than RMB330 per square meter (based on residential gross floor area), which is exclusive of project marketing and management fees. In addition, in the event that the average sales price is higher than the benchmark price agreed upon between the parties, the Company will be entitled to the additional earnings. 

The project is a commercial and residential complex located in the Binhu New Area of Hefei on a site to the east of Luzhou Avenue, west of the planned Shaoshan Road, south of land boundary of the usable area, and north of Hangzhou Road. The project covers a residential floor area of approximately 91,840 square meters, in addition to some subterranean space. The project is located in the center of the Binhu New Area and is near a subway station in construction. Its retail area is developed and operated by the Intime Retail Group national department store chain. Upon completion of the green technology residential area constructed by Landsea, the project will be a landmark commercial and high-end residential development in the city.

Joint Cooperation with Pingan Real Estate in the Jiangning Land Parcel Project

The Company also announced that it had entered into a cooperation agreement with Pingan Real Estate for the joint development of a commercial and residential project located to the west of Jing’er Road and north of Jinwen Road in the Jiangning Binjing Development Zone of Nanjing (“Jiangning Land Parcel”). Pursuant to the agreement, the Company and Pingan Real Estate will make additional capital injection in a project company and  own 50.1% and 49.9% of the project company, respectively. On June 20, 2014, the Company made a successful bid for the land use rights for the Jiangning Land Parcel at an aggregate purchase price of RMB200million.

Mr. Tian Ming, Executive Director and Chairman of Landsea Green Properties, said, “The foregoing agreements illustrate the Company’s successful execution of its ‘asset-light strategy and profit-diversification strategy’. Apart from synergies stemming from collaboration, the cooperation agreement with Shanghai Construction Group, Pingan Real Estate, and China Merchants Property Development to co-develop the Nanjing Hexi CBD Land Parcel project, as well as the cooperation agreement with Pingan Real Estate to jointly develop the Jiangning Land Parcel, also spread out the investment risks and created a new model for generating profit.”

“The entrusted project development management and green building technology services framework agreement with Hefei Hualun to provide professional management and technology services and the project management and sales services provided by the Company for the Hexi CBD Land Parcel project substantially reflect the market’s affirmation of Landsea Green Properties’ professional technologies and services. The Company is able to provide technology, management and development capabilities and generate profit by providing technologies and services rather than merely generating returns on heavy assets and investment. In the future, Landsea Green Properties will continue to embrace profit-diversification and strive for an asset-light business model to withstand market fluctuations, as well as to create value for its shareholders.” Mr. Tian added.