Ying Li / CapitaLand

Ying Li / CapitaLand: Deutsche concluded its Chongqing property tour, visiting various residential and commercial projects. Notes, overall, as in most other Tier 1 /2 cities, residential sales in Chongqing have continued to pick up at a solid pace, while ASPs have shown moderate increases. Going forward sees gradual ASP increases of 5-10% as not unreasonable. Adds, risk of new policies do not look likely, given the city’s proactive land supply approach to cap sharp rises in property prices. Ying Li is mainly involved in office and residential projects in Chongqing. Deutsche also visited 2 largest shopping districts in Chongqing - Guan Yin Qiao and Jie Feng Bei - and saw strong traffic flow/consumer spending. E.g, in Paradise Walk, Mao Ye Shopping Center, and Starlight 68 in Guan Yin Qiao, it saw lots of visitors in shops (esp. in branded stores like H&M, Uniqlo, Muji) and restaurants, with long taxi queues outside the malls. Rents of hiqh-quality retail spaces there have shown >10% growth in 2012, and similar growth is expected in 2013. CapitaLand will jointly develop a mixed-use property project in Southwestern Chongqing, estimated to cost ~$4.1b, comprising residential, retail, office and hotel properties with total gfa of 817k sm, to be completed by 2016. CapitaLand and its 65.5%-owned CMA will collectively hold a 50% stake in the Chongqing devt, with Temasek holding 30%. The remainder is held by unnamed investors.