The emirate's Roads and Transport Authority completed the construction of a network of main roads with a total length of 9.5 km
Super Ocean Group, whose chairman is high-profile businessman Ye Lipei, has put a package of four buildings on sale as it seeks cash to support its growth in other sectors, the sources told Reuters on Wednesday.
The four buildings to be sold by Super Ocean include the Bank of Shanghai Tower in the Lujiazui area of Shanghai's Pudong financial district, and Southern Securities Mansion, located on Nanjing Road, one of China's busiest commercial streets, the sources said.
Super Ocean aims to sell the four buildings together but potential bidders have the option to purchase three of the four, said the sources, who did not want to be identified because the deal was not finalised. They put the price tag for the deal at 5 billion to 7 billion yuan ($728.8 million-$1.02 billion).
Representatives for US-based Blackstone could not immediately be reached for comment. Super Ocean declined to comment.
Two of the three sources said no deal had been reached yet and talks between Blackstone and Super Ocean could collapse over valuation of the buildings. The other source said Super Ocean aimed to complete the deal by the end of this month.
‘It's not easy for Blackstone and Super Ocean to reach a deal as Super Ocean is probably asking too much for these properties,’ said one of the sources.
‘There are also concerns about the ownership structure, which is a bit complicated for some of the four buildings,’ he added.
The 7-billion-yuan price tag for the four buildings in the proposed package deal was offered by Super Ocean late last year for bidders' reference, though the final price could be lowered amid growing concerns about global property investment.
In China, the government has clamped down on bank lending for construction and imposed various measures including taxes and new rules to try to stamp out property speculation.
Although aimed at the residential market, the steps are cooling appetite for land and starving property firms of funding, so could also put downward pressure commercial property prices.
Besides Blackstone, other potential buyers include Ireland's Treasury Holdings and an Australian asset manager, which the sources declined to name.
Negotiations between Treasury Holdings and Super Ocean stalled over price issues several months ago, said one source. But Blackstone and the Australian fund are still separately in talks with the Chinese developer, the other sources said.
Treasury Holdings declined to comment. The Dublin-based firm established and owns a 46 percent stake of China Real Estate Opportunities, listed on the AIM market at London Stock Exchange in July 2007.
In June, Blackstone agreed to pay 1.1 billion yuan for a commercial building in central Shanghai, making it the first foray into China's property market.
Last week, Blackstone, in which China's sovereign wealth fund holds a stake, opened a Beijing office and hired a former government official to expand its acquisition business in China. (For details:
Earlier this year, Morgan Stanley planned to sell at least two serviced apartment projects in Shanghai, which are wholly owned by its real estate fund, for several billion yuan, people familiar with the situation told Reuters. That deal has not been completed yet.
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