Shui On Land expects bumper rental income from Corporate Avenue II

Mainland developer Shui On Land says its office-retail project, Corporate Avenue II, will generate annual rental incomes of up to 700 million yuan (HK$862.84 million) once all the space has been leased.

The project, which will offer 105,000 sqmetres of office space in two towers and 51,000 sqmetres of retail space, is now under construction and is due for completion next year.

It is among several assets that could be included in the proposed separate listing for China Xintiandi, which will focus on managing, designing, leasing, marketing, enhancing investment properties in urban areas on the mainland.

Another possible asset that could be included in the spin-off is the group's 8 billion yuan office-retail-exhibition project, The Hub, which is under construction in the transportation hub in the Hongqiao commercial zone.

"[Corporate Avenue II] will be the only new supply of mixed-use development in a prime location in Shanghai for the next three to five years," said Carrie Liu, general manager for commercial at Shui On Development, a unit of Shui On Land. Annual rental income from the project could reach up to 700 million yuan once it was fully leased, she said.

Total rental income for the year to December would be about 1.2 billion yuan, Shui On Land chief executive Freddy Lee said. The group's full-year results will be announced in March.