AGP.L Regulatory News (AGP)

16 Jan 2006 07:00

Asian Growth Properties Limited 16 January 2006 Asian Growth Properties - Admission to trading on AIM •Commercial & residential property investment and development company headquartered in Singapore and operating in Hong Kong •Four key property assets in Hong Kong, independently valued by Chesterton Petty Ltd at HK$1,518million (£110.5million) •Three are development properties and the fourth a retail investment property •Sourcing additional development sites and property assets in Asia Pacific markets •Cash balances at 30 September 2005 of HK$633 million (£46 million) and pro forma NAV per share of 54p Asian Growth Properties Limited ('AGP' or 'the Company'), the commercial and residential property investment and development company operating in Hong Kong, today announces the commencement of trading on AIM. HB Corporate is acting as Nominated Adviser and Broker to the transaction. The Company has 217,693,995 shares in issue and a market capitalisation of circa £80 million. AGP has four key property assets in Hong Kong which have been independently valued by Chesterton Petty, as at 30 September 2005, at HK$1,518 million (£110.5million). These investments are in four of Hong Kong's 18 districts being Causeway Bay, San Po Kong / Wong Tai Sin, Sha Tin and Wan Chai. AGP is identifying for purchase other property assets and development sites in the Asian market. In March 2005, AGP acquired certain subsidiaries and hence the Asian property assets of Trans Tasman Properties Ltd ('TTP'), a subsidiary of SEA Holdings Limited which is listed in Hong Kong and develops and invests in high quality office, retail, residential and resort properties in Asia Pacific countries. TTP itself is a property investment and development company headquartered in Singapore and listed on the New Zealand Exchange with investments in Australia and New Zealand. Commenting today, Don Fletcher, CEO said: 'Following Admission, the Company's strategy is to pursue the profitable development of its property assets and to identify and invest in further properties and development projects within Hong Kong, China and other high economic growth areas in the Asia Pacific market. The Company expects to derive the majority of its revenues from the development and subsequent sale of developed property assets.' For more information: Don Fletcher Chief Executive Tel: +44(0)207 429 6666 David Newton HB Corporate Tel: +44(0)207 510 8561 Pam Spooner / Abigail Singleton / Leesa Peters Conduit PR Tel: +44(0)207 429 6666 pam@conduitpr.com / abigail@conduitpr.com Appendix The Hong Kong Property Market The Hong Kong property market, including both the commercial and residential sectors, is volatile and prices often move materially over a relatively short period of time. The Hong Kong property cycles have historically been significantly shorter and more volatile than comparable markets in Europe, North America and Australia. Given the underlying volatility of Asian markets in general, and the Hong Kong market in particular, the Company does not publicly forecast returns from its development assets. Land System and Policy in Hong Kong Land in Hong Kong is held from the Government of the Hong Kong SAR on a leasehold basis. Leases in Hong Kong are normally sold by the Government by way of public auction or private treaty. It is usually sold by way of public auction sales or tender, whereby the Government would sell the land to the highest bidder or tenderer for a premium and subject to the payment of Government Rent. The Government usually grants land subject to certain conditions and upon fulfilment of such conditions a Government Lease will be issued. Whatever kind the Government Grant is, the grants always contain requirements which control the use and the extent of the development. Land Premium It is Government policy to modify old lease conditions in accordance with town planning requirements. Leaseholders may apply to the Government to vary the prescribed use of the land (for example, to convert an industrial site to residential use). If the Government supports the proposed lease variation it will issue consent subject to terms and conditions in relation to the use of the land, scale of development and timetable for that development to occur. The premium is required to be paid before the lease modification becomes effective. In Hong Kong the land value in relation to residential development is often a significant portion of the total development cost. The premium payable is therefore a material cost of any development feasibility and the timing of the negotiation and agreement of the premium is often critical to the development's success. Overview of AGP's Current Property Portfolio 1) San Po Kong development site San Po Kong was purchased by TTP in September 2004 and is currently valued at HKD$650m (£47.3 million). The property is being developed into a commercial and residential development comprising a 41-storey residential building erected over a 7-storey commercial, recreational and car park podium. Development of the site commenced in the first quarter of 2005 and is expected to be completed in third quarter of 2007. AGP intends to sell the entire completed project. 2) Sha Tin development site The Sha Tin Town development property was purchased by TTP in June 2004. It is currently valued at HKD$610m (£44.4million). The property lies within an area zoned 'Comprehensive Development Area'. Development / redevelopment of the area is intended for residential and / or commercial uses with the provision of open space and other supporting facilities. All uses and developments therein are subject to prior approval from the Town Planning Board. The Company is currently advancing development plans for this significant land holding and has applied to the Town Planning Board for approval of a comprehensive development scheme in conjunction with the adjoining sites. The scheme proposes a three phase development. It is expected that negotiations and variations to the proposed scheme will continue in 2006. Upon the receipt of development approval, the Company proposes to commence negotiations with respect to the development premium that will be payable to the Hong Kong Government on the relation to the change of use of the land form its current industrial use to that approved by the Town Planning Board. 3) Wanchai development site The Wanchai Road development property was purchased by TTP in November 2004. It is currently valued at HKD$202m (£14.7million). The property comprises three adjoining roughly rectangular sites. The property is a vacant site and construction works are in progress. The property is being developed into a commercial and residential tower comprising 18 storeys of residential units erected over a clubhouse floor and a 3-storey commercial podium. The ground floors are mainly designated to be retail shops, with three retail units on the ground floor and one retail unit each on the first and second floors. A clubhouse is planned for the third floor. The fourth to 21st floors are planned for residential purposes with four flats per residential floor. The ground floor shops have frontages on the Wan Chai Road. The proposed development is currently under construction and is scheduled to be completed in mid-2007. 4) Causeway Bay - The Excelsior Plaza shop This retail investment property was purchased in March 2004 and is currently valued at HKD$56m (£4.1million). The property comprises a 3-storey commercial podium surmounted by two high-rise residential developments. The property includes an individual shop unit, and lies within an area zoned 'Commercial / Residential'. Under this statutory zoning, developments are restricted to commercial and / or residential developments. Directors and Senior Management David Carr Mathewson: Non-Executive Chairman Mr Mathewson is Chairman of Sportech plc and Amazing Holdings plc. He is a non-executive director of Noble & Co Ltd, merchant bankers, Edinburgh UK Tracker Trust PLC and various private companies. He is also non-executive Chairman of Geared Opportunities Income Trust plc and a Trustee of the Royal Botanic Gardens, Edinburgh. Mr Mathewson is a qualified chartered accountant. Donald Fletcher: Chief Executive Officer and Executive Director Mr Fletcher joined the Board in February 2004. He is the Executive Chairman of TTP and was until Admission the Chief Executive Officer of TTP. Mr Fletcher also holds the responsibility for S E A Group operations in New Zealand and Australia. Mr Fletcher joined the S E A Group in 1991 and has extensive knowledge of the Asia-Pacific region property markets following considerable experience in the region over a period of 19 years. Mr Fletcher is based in Singapore and, prior to his appointment as Chief Executive Officer of TTP, worked within the property sector in Hong Kong. David Runciman: Executive Director Mr Runciman joined the Board upon Admission. He is a Fellow of the Royal Institution of Chartered Surveyors and has spent much of his working career in Asia dealing with all aspects of residential and commercial real estate markets. He formerly served as Chairman for Asia Pacific for CBRE, the world's largest property services company. Mr Runciman worked with Richard Ellis, (subsequently CBRE) for 30 years and was responsible for growing the business from a company comprising just four professionals in 1977 to a company with over 2000 staff operating out of 54 offices throughout Asia in 2002. Mr Runciman is the CEO of Scottish and Oriental Estates which is his own investment company and has been a resident of Hong Kong since 1977. Larry Yong: Finance Director Mr Lim joined the Board upon Admission. He joined the TTP head office in Singapore in 2005 and was for the preceding nine years a senior finance manager of Singapore-listed Keppel Telecommunications and Transportation Limited. Mr Lim is a qualified accountant with experience in the property, audit, finance and treasury fields. He has a bachelor's degree in accounting, finance and economics and is an associate member of CPA Australia. Lu Wing Chi: Non-Executive Director Mr Lu joined the Board in February 2004. He is Chairman of S E A and is a director of many of its subsidiary and associated companies. Mr Lu has more than 25 years' experience in property investment and development in Hong Kong and throughout the Asia-Pacific region. He is responsible for international investment planning strategies within the S E A Group. Richard Prickett: Non-Executive Director Mr Prickett joined the Board upon Admission. He is a Chartered Accountant and has many years' experience in corporate finance. He was Chairman of Brancote Holdings Plc from 1995 until its merger with Meridian Gold Inc. in July 2002. He is a non-executive director of Patagonia Gold Plc, having previously been the Chairman, and he is also a non-executive director of the Capital Pub Company Plc. This information is provided by RNS The company news service from the London Stock Exchange XLFFQFBXBBF