Leadership

CREO’s Chinese properties rise 4pc in value

08.03.2010
The AIM-listed and Treasury Holdings-backed China Real Estate Opportunities (CREO) has reported a 4pc rise in the value of its portfolio of Chinese properties for the six months from the end of June 2009.

In its preliminary results statement for 2009 released today, CREO said its portfolio was valued at CNY9.19 billion (stg£836.9m) as of the end of December 2009.

The company also reported “significant” progress in its strategy of refinancing its investment assets and strengthening its capital position through the disposal of non-core holdings. This includes the sale of its 50pc interest in the Tangdao Bay joint-venture development, which will net it £35.6m in cash.

Including proceeds from the Tangdao Bay disposal, CREO said its cash holdings as of the end of December 2009 were just over stg£80m.

2009 ‘challenging’ on office-leasing front
The property group said that while the Chinese economy continued to strengthen throughout the year, 2009 had proved to be a “challenging” year on the office-leasing front with market vacancy rates in Shanghai peaking at 14.2pc in the first quarter, before falling back to 11.4pc by year end.

The company said its retail sector, however, continued to perform strongly, helped by the resurgence of the Chinese consumer.

“2009 has been an important year as the company successfully applied its asset-management expertise to deliver strong results in a competitive market, while also positioning the company for the future,” said CREO Chairman Ray Horney.

“Important milestones were reached such as the refinancing of the Treasury Building and the sale of the non-core stake in Tangdao Bay. The financial position of the company has been considerably strengthened and the board remains confident about the outlook for the company.”

Optimistic for 2010
CREO also said today it is mulling the possibility of listing on the Singapore Exchange, a move that would result in its delisting from AIM.

The company’s board said it was “very pleased” with the company’s strong operational performance during the year, as well as its strengthened cash position.

“The board believes the company is now well placed to address its capital structure through the tender offer and its proposed Asian listing this year.”

It added that it remains optimistic about the outlook for 2010.

CREO was set up by Treasury Holdings to acquire investment and development properties in China.