Review of 2013

In 2013, the Chinese government continued to introduce policies and measures to regulate the real estate market and these, to a certain degree, suppressed speculative investment. Sales of residential projects therefore were primarily to people looking for homes they would occupy themselves or looking to upgrade.

During the year, attributable profit from mainland property rose by 15% owing to the sale of a commercial building (CITIC Plaza Shenhong) in Shanghai. Most of our residential projects remained in the development phase, with limited finished units for delivery.

However, pre-sales of residential units in 2013 were at a record high with total sales reaching 223,000m2 Gross Area (GA). For projects such as The Centre in Jiading and Zhujiajiao New Town in Qingpu, we adjusted our strategy based on market demand to focus on the development and sales of smaller apartments, thus achieving a better result during the year. Since Wanning city had no purchase restrictions, our Shenzhou Peninsula project in Hainan attracted large numbers of buyers and therefore recorded satisfactory sales. All these pre-sales bookings, however, will not be recognised until the units are completed and delivered to buyers.

With the continued demand for Grade A office buildings in prime locations, our CITIC Square and Royal Pavilion investment properties in Shanghai maintained a high occupancy rate and stable income during the year. In 2013, we sold an office building to the Shanghai Branch of CITIC Bank, which will be constructed on the Shanghai World Expo site.

Looking at 2014, we do not anticipate significant changes to the policies adopted by the Chinese government. We will therefore continue to adjust our development strategies in response to the market situation. At the same time, we will consider increasing our land bank when appropriate.

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