CTBC Financial Holding Co (中信金控) expects to add NT$7.04 billion (US$214.6 million) to its annual net income this year after wrapping up the sales of its former headquarters site in Taipei’s Xinyi District (信義).
That will translate into an addition of NT$0.38 earnings per share to CTBC Financial’s net income this year.
The holding company, which owns the nation’s biggest credit card issuer, CTBC Bank (中信銀行), on Friday said that it has sold 95 percent stake in its former headquarters on Songshou Road to a subsidiary of land developer Continental Holdings Corp (欣陸控股) and Green Heaven Investment Ltd BVI (英屬維京群島商子樂開發股份有限公司) for a combined NT$15.12 billion, according to a filing with the Taiwan Stock Exchange.
Photo: Chiu Shao-wen, Taipei Times
Green Heaven is a subsidiary set up by foreign private equity firm Riant Capital (子樂投資), while Continental Holding operates real-estate developer Continental Engineering Corp (大陸工程).
The new owners reportedly plan to tear down the two buildings and build a new one.
CTBC Financial said it has reserved a 5 percent stake in the new building so that CTBC Bank Co (中國信託銀行) can continue to operate a branch there. It also said that it retained an option to purchase back the 95 percent stake of the building.
The sale of the site had been delayed since late 2013 after the Taipei City Government declared that part of the site, Novel Hall (新舞台), was a cultural heritage structure.
Concerns about the city’s decision and what it meant for developing the site contributed to the delay, during which time the asking price for the site tumbled from the original estimate of NT$20 billion.
The theater, which is behind CTBC’s headquarters, but connected to it, became the focal point of a preservation drive by prominent artists and cultural experts. The Ministry of Culture also urged its preservation.
At the end of July, CTBC Financial signed an agreement with the Taipei City Government to preserve Novel Hall, paving the way for the sale of the site.
In accordance with that agreement, the site’s new owners have to build a theater with comparable stage space and seating capacity to Novel Hall, which had just under 950 seats, in their new development.
Riant Capital said it plans to develop a NT$10 billion, 45-story complex containing a hotel, retail and office space, and a theater.
The sale still requires the approval of the Ministry of Economic Affairs’ Investment Bureau because the buyers include foreign entities.
In other property news, two high-profile auctions held last month for Shinkong Manhattan World Trade Building and A8 building near the Shin Kong Mitsukoshi Department Store (新光三越百貨) in the Xinyi area failed find a buyer willing to spend more than the respective NT$9 billion and NT$28 billion minimum bid required for the two properties.
Life insurance firms were apparently unwilling to buy the properties because their estimated investment return rates are not likely to exceed the 2.805 percent minimum required by the Financial Supervisory Commission.
Additional reporting by staff writer
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