CDL To Invest Up To $460m In Korean Project

Source : The Straits Times, 17 Aug 2007

It signs MOU to develop residential and commercial site in Incheon

CITY Developments (CDL) will be giving one of South Korea’s leading cities, Incheon, an image boost, with plans to invest up to US$300 million (S$459.2 million) in a major residential and commercial project.

The Singapore-listed property giant yesterday signed a memorandum of understanding with DC Chemical Company (DCC) to develop a large site in the city.

Under the deal, it will pump between US$150 million and US$300 million into the site, which is more than 600,000 sq m. By comparison, Suntec City Mall has only about 82,498 sq m of retail space.

Incheon, which will play host to the 2014 Asian Games, is a major seaport with a population of about 2.5 million, not far from the country’s capital of Seoul.

A large-scale commercial centre will be built on a site of 281,850 sq m, DCC said at a press conference held in Incheon yesterday.

The centre will consist of a 50-storey tower, incorporating a ‘top-class’ hotel, a service residence and an office building. These will be anchor facilities.

Department stores, brand outlets, multiplex cinemas and an e-sports gaming hall will flank both sides of the tower.

To the north of the integrated commercial centre, another large site of about 380,000 sq m of land is slated for residential development.

Renowned British and engineering firm Atkins - which was responsible for the Burj Al-Arab in Dubai, the world’s first seven-star hotel - has been roped in to be the conceptual designer for the project.

Development work is scheduled to begin in two years with the main commercial centre to be constructed first, followed by residential blocks in 2010.

The large-scale commercial centre, according to DCC’s chief executive, Mr Baik Woo Suk, will ’significantly increase’ economic activity in the area and will create many jobs, in a boost to Incheon’s economy.

‘When Incheon City hosts the Asian Games in 2014, this commercial centre will be the very first image visitors will see when crossing over on Incheon Bridge into Incheon City,’ he said.

CDL’s group general manager, Mr Chia Ngiang Hong, said the firm is always on the lookout for ‘new strategic growth opportunities’, and it believes this investment is timely, given the ‘exciting developments’ in South Korea.

‘With the synergistic collaboration of an established company such as DCC, coupled with our many decades of experience in the real estate and hotel industry, we are very positive about the prospects of this project,’ he added.

This is not CDL’s first investment in South Korea’s burgeoning economy.

Subsidiary Millennium and Copthorne Hotels owns and operates Millennium Seoul Hilton hotel, Hong Leong Group spokesman Gerry de Silva told The Straits Times. ‘Of course we’re looking for viable investments in the region, and we’ve been looking at Korea for several years now. We think Korea is a market that can offer more value.’

Shares of CDL, which is part of the Hong Leong Group, closed 50 cents lower at $13.60 yesterday. The announcement came after the market had closed.

Listed on the Korean Stock Exchange, DCC is among the world’s top producers of carbon black, soda ash and pitch.