Shanghai Zendai to Develop $8B Financial Hub in South Africa
- Nov 15, 2013
By Adriana Pop, Associate Editor
Hong Kong-based developer Shanghai Zendai Property Ltd. is planning to transform a Johannesburg suburb into a global financial hub.
According to Bloomberg, Shanghai Zendai intends to invest 80 billion rand ($7.8 billion) in its massive mixed-use project over the next 15 years. Plans call for the construction of various commercial, light industrial and retail facilities, as well as 35,000 houses, an educational center and a sports stadium.
“It will become the future capital of the whole of Africa,” the company’s chairman Dai Zhikang said during a press conference. “This will be on par with cities like New York in America or Hong Kong in the Far East.”
Shanghai Zendai has recently signed an agreement with AECI Limited of South Africa to acquire the site for its new development, which consists of several parcels of land and buildings covering approximately 1,600 hectares (nearly 4,000 acres) in Modderfontein. The property, which is located between the Sandton area of Johannesburg (an existing financial center) and OR Tambo International Airport, sold for 1060.98 million rand ($104.6 million).
“Johannesburg is the political, economic and cultural center of South Africa, hence the property possesses enormous development potential,” Shanghai Zendai said in a statement.
The company’s management conducted market research and valuation on the property project in Johannesburg two years ago. After negotiating with the vendor for 18 months and conducting due diligence for six months, Shanghai Zendai finally reached the purchase agreement. The developer also agreed to retain the original management team for developing and managing the project in order to reduce operation, management and market risks.
“As a diverse property development company, aside from focusing on the Mainland market, we have also been following the trend of channeling investments overseas as practiced by other Chinese enterprises, looking for property development projects of suitable scale that allow for international expansion,” Zhikang added.
The company’s first overseas project was a mixed-use development in Auckland, New Zealand, which was launched in 2011.