Core Pacific City Co (京華城), operator of the unprofitable Living Mall in Taipei’s Songshan District (松山), yesterday sold the property to an affiliated company in an auction after three previous attempts failed to draw any bidders.
China Petrochemical Development Corp (CPDC, 中石化) acquired the mall for NT$37.2 billion (US$1.2 billion) through its development unit, the company said.
Both Core Pacific City Co and CPDC are major units of the Core Pacific Group (威京集團), which also owns civil engineering, construction, financial and entertainment businesses.
The mall covers 4,986 ping (16,483m2), with 62,000 ping of floor space across 12 stories above ground and eight underground floors.
The group has since December last year sought to find buyers for the retail complex at an asking price of NT$38 billion and later lowered the amount to NT$34.2 billion.
The group took out a syndicated loan of NT$12 billion two decades ago to finance the construction of the L-shaped commercial complex and the debt is due to mature later this year.
The group made a similar transaction years ago by having subsidiary BES Engineering Corp (中華工程) acquire land in the city’s prime Xinyi District (信義) and develop a high-profile residential building, Taozhu Garden (陶朱隱園), which is about to enter the property market.
CPDC plans to tear down Living Mall next year and construct a top-class commercial zone featuring four new 19-floor office buildings, company vice president and spokesperson Chen Ying-chun (陳穎俊) told a media gathering.
The company expects to sell the new office buildings at NT$1.2 million or above per ping during the presale period, Chen said, adding that the company aims to look for potential buyers next year.
The four office buildings would be smart and environmentally friendly, and would be able to accommodate 10,000 people, the company said.
“As the vacancy rate for office buildings remains low in Taipei and office rental has been increasing, the mall’s land value is expected to climb,” the company said in a news release, citing data from real-estate brokers.
In addition, Living Mall is one of the few plots of land in the eastern Taipei area that is vast, complete and available for development, CPDC said.
Given that more Taiwanese companies are returning and foreign companies are moving in, while Taipei lacks new office buildings, the company believes selling and leasing offices would lift its revenue and profit, it said.
The company is to retain Living Mall’s basement and piles, which would shorten the construction period by 12 to 16 months, it said.
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