STAKE IN SHANGHAI PROJECT SOLD FOR $ 552M

China Overseas Land and Investment, a state-backed property developer listed in Hong Kong, has offloaded a 60 percent stake in a Shanghai office and commercial development for HK$ 552 million. The company said it will book a HK$ 160 million gain from the sale of its stake in a venture that owns the property, Shanghai Square. MSR Asia Acquisitions is the buyer, it said. The second-biggest shareholder in the joint venture, Shun Hing Holdings, also decided to sell its 32 percent for HK$ 294.4 million to MSR Asia.

China Overseas chairman and chief executive Kong Qingping said the sale of its stake was at a reasonable price'' but did not give a reason for the disposal. The venture reported an audited net loss of 8.7 million yuan (HK$ 8.1 million) for 2004 after a net profit of 5.83 million yuan in 2003, China Overseas Land said. The Shanghai Square development consists of a 25-story office tower with a six-story commercial podium and carpark. Office space totalling 25,851 square meters has sold out'', the company said in the statement, while the shopping podium with an area of 40,693 square meters is 93 percent leased. After the disposal of Shanghai Square, China Overseas Land's only other commercial property in Shanghai is its 51 percent interest in Level 3 of Hai Xing Plaza, according to its latest annual report. As for residential projects, it expects to complete Phase 2 of Peace Garden and Phase 1 of Jade Laguna this year. Last year it completed Phases 2 and 3 of Hai Yui Garden in Shanghai.

Earlier this month, Kong said the company had a Shanghai landbank of 7.54 million square feet in gross floor area but would not be adding to it during the coming year. To concentrate on its property business, China Overseas is spinning off its construction unit to a newly formed subsidiary of its parent. Shares in China Overseas closed 1.57 percent higher Wednesday at HK$ 1.59. JOURNAL-CODE: WHKS

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