New World Department Store China Limited ("NWDS" or the "Company"; Hong Kong stock code: 825), one of the largest owners and operators of department stores in the PRC, is pleased to announce its acquisition of a property, including a right to use carpark, in Shenyang City, Liaoning Province for a consideration of approximately RMB 287,540,000. The Company intends to develop the property as the fourth self-owned department store in Shenyang City.
Being the capital of Liaoning Province, Shenyang City is the biggest economic and industrial center in Northeastern China. It is also the transportation hub of the region located along the way leading to the south of the Great Wall of China. For the first quarter 2008, Shenyang City recorded a GDP of RMB 65.71 billion*, a 16.4%* increase from the same period in 2007. The total retail sales of consumption goods during the period amounted to RMB 36.95 billion*, representing a 19.7%* growth year-on-year. All these evidence the rapidly developing economy and rising consumption power of Shenyang City.
The proposed fourth store in Shenyang City is located in the busy Zhong Street Commercial Circle in Dadong District of the city. The area is well connected by transport. The new project, with a GFA of approximately 32,500 sq m, is due to open in 2010. The District government has been advocating the development of Dadong's commerce and service sectors in recent years, aiming for becoming a large scale modern commercial district. This will further drive Dadong District's economic growth. Taiyuan Street Commercial Circle and Zhong Street Commercial Circle are both famous and key commercial circles of Shenyang City. Zhong Street Commercial Circle is a thriving business centre for shopping, leisure, entertainment, dining and cultural activities in the city. Following the strong presence in Taiyuan Street Commercial Circle, NWDS is expanding into Zhong Street Commercial Circle which is of the same grade as the former.
Mr Adrian Cheng, Executive Director of NWDS, said, "Shenyang is one of the major cities in the Northeastern China region. It is also our second foothold in China's retail market after Wuhan. NWDS opened its first department store in Shenyang City in 1995."
"Today, we operate three stores in the city, all of which are self-owned. The latest acquisition indicates our confidence in the development potential of Shenyang City. Additionally, it is in line with our "multiple stores within a single city" strategy. We believe that with the opening of the fourth store, the synergies of our store portfolio in Shenyang City will emerge gradually. In order to further enhance our operational efficiency, we will continuously look for quality projects in Shenyang City."
Mr Philip Cheung, Executive Director and Managing Director of NWDS, added, "Wuhan is our core city in the Central China region. We leverage the citys strong radiation effect to develop our business in its satellite cities and its neighboring provinces. Likewise, Shenyang is designated as our core city for the Northeastern China region. Going forward, we will adopt the "radiation effect' strategy whenever appropriate to seize development opportunities in the region."
*Source: Shenyang Statistics Bureau (http://www.sysinet.gov.cn)