HKR International Announces Major Land Acquisition and Joint Venture in Jiaxing, China

Key Points from the Announcement

• Land Acquisition: HKR International, through its wholly-owned subsidiary Jiaxing Xiuyu Commercial Management Company Limited, and an independent JV Partner, successfully secured land use rights for a prime site in Jiaxing City, PRC, for RMB216,431,440 (approx. HK\$245.9 million).
• Joint Venture Structure: The JV Partner will hold 90% equity in the Project Company, while HKR International will hold 10%.
• Capital Commitment: Total capital commitment for the Project Company is capped at RMB1,950 million (approx. HK\$2,216 million). HKR International’s commitment is limited to RMB195 million (approx. HK\$221.6 million).
• Development Plan: The land, spanning 72,628 sq.m., will be developed into a shopping centre with a maximum gross floor area of 130,730 sq.m., intended for rental income.
• Payment Terms: 50% of the land price will be paid within 30 days of signing the Land Use Rights Transfer Contract, with the balance due within 240 days.
• External Financing: RMB1,170 million of the capital will be sourced through external financing. HKR International may provide a corporate guarantee up to RMB117 million for its 10% share.
• JV Partner: The JV Partner is a state-owned enterprise, Jiaxing Xiutuo Construction & Investment Group Co., Ltd., ultimately owned by the Jiaxing Municipal People’s Government.
• Listing Rules Implications: The transaction qualifies as a discloseable transaction under Chapter 14 of the Hong Kong Listing Rules, requiring reporting and announcement but not shareholder approval.

Details Investors Should Note

Strategic Location: The acquired land is in Xiuzhou District, Jiaxing, adjacent to Xiuhu Park, with scenic waterfront and close proximity to Jiaxing city center and major transport routes. This is a mature area with a resident population of about 720,000, strong community facilities, and mid- to high-end residential developments.

Project Rationale: HKR International views this as a significant opportunity to enhance its presence in the region, leveraging the local government-backed JV Partner for growth. The joint venture structure allows HKR International to minimize capital outlay and exposure to business risk, especially in an uncertain market environment.

Light Asset Investment: The structure enables the company to participate in a large commercial project with limited capital commitment and risk, which aligns with prudent capital management and risk reduction strategies.

Potential Share Price Impact:

• The announcement represents a material investment in a growth market, backed by a state-owned enterprise, and positions HKR International for future rental income and asset appreciation.
• The limited capital exposure and risk-sharing arrangement may be viewed positively by investors, especially given the current market volatility.
• Successful completion and operation of the shopping centre could enhance future earnings and asset value. However, investors should remain aware of execution risks and potential delays in development or external financing.
• While the transaction does not require shareholder approval, it is significant enough under listing rules to warrant attention. The maximum capital commitment and potential guarantee exposure should be monitored.

Additional Information

• Jiaxing Xiuyu will fund its capital commitment from internal resources and/or external financing.
• If external financing is insufficient, the JV Partner will provide shareholder loans at competitive market rates.
• The Project Company is expected to sign the Land Use Rights Transfer Contract before 30 March 2026.
• The JV Partner, Jiaxing Canal Bay City Investment Group Co., Ltd., is ultimately controlled by the State-owned Assets Supervision and Administration Commission of Jiaxing Municipal People’s Government.
• None of the JV Partner or its ultimate owners are connected persons to HKR International.
• Exchange rate used: RMB 1 = HK\$1.1362 (as of 16 March 2026).

Board Composition

The Board comprises Executive Chairman Mr. CHA Mou Zing Victor, Non-executive Directors, Executive Directors, and Independent Non-executive Directors, reflecting a robust governance structure.

Disclaimer

This article is intended for informational purposes only and does not constitute investment advice or a recommendation to buy or sell any securities. Investors are encouraged to conduct their own research and consult with financial advisors before making investment decisions. The information contained herein is based on publicly available documents and may be subject to change or interpretation.

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