Somerset to Refurbish French Colonial Bungalows in Shanghai for Rental to Top-Level Expatriates
Singapore, August 29 - Somerset Holdings is working with Shanghai's state-owned property company to restore and manage a group of rare French colonial bungalows for rental to top expatriates in the city.
The 22 bungalows are located next to the residence of the former Chinese premier Zhou En Lai, which is a similar restored building. The 10,000 square metre estate of large detached houses with sprawling gardens in Lu Wan district is one of the few such sites of this size in downtown Shanghai.
In a co-operative agreement that Somerset's deputy chairman, Mr Liew Mun Leong, signed today (Aug 29) with the chairman of the state- owned Shanghai Yongye Enterprise (Group) Co Ltd, Mr Wu Yong Hua, Somerset will invest RMB 43.45 million (S$8.75 million) in the project and manage the bungalows.
Shanghai Yongye will provide a 30-year head lease, subject to the Shanghai municipal government's approval, and invest RMB 18.55 million (S$3.74 million). Somerset will also have first right option to participate in the next phase of the Shanghai municipal government's masterplan to develop the Lu Wan district historical area around the bungalows.
Mr Liew said: "These bungalows' unique French architecture and rich history cannot be duplicated, and such estates are rare in downtown Shanghai. They represent a gem of an opportunity and we are honoured to have the privilege of helping preserve a precious part of Shanghai's splendid buildings heritage.
"We will develop the potential of these grand villas and present it as part of our collection of premium Somerset Heritage properties for top expatriate business leaders and government officials in the region. Given the rapid economic growth of Shanghai, there is sufficient critical mass of such high level expatriates in this thriving gateway city to support such quality developments."
Mr Liew, who is also the President of Pidemco Land, Somerset's parent company, added: "This project will significantly increase the depth of Somerset's presence in Shanghai and China. With these historical bungalows, we will extend our reach to the top three to five per cent of the expatriate housing market."
First Class Bungalows
Somerset's chief executive officer, Mr Kee Teck Koon, said that once the head lease is approved by the Shanghai municipal government, the villas will be launched as Somerset Heritage Shanghai and will be marketed along the lines of the very successful Somerset Heritage group of restored "black and white" bungalows in Singapore.
The 33 historical houses with large grounds at Mount Pleasant in Singapore are rented to CEOs of multi-national companies and diplomats, and boast a waiting list among top expatriate business and diplomatic leaders in the country.
Mr Kee said that the Shanghai colonial villas and their unique architectural features will be carefully refurbished to their former glory, with the discreet addition of convenient modern amenities. Quality fittings will be used and each bungalow will be internet enabled with broadband capability.
Provisions will be made for intercom, autogate, music and home theatre systems, and even gyms. The extensive support services for the bungalows will even include specially trained maids assigned to each house.
Each villa boasts generous grounds with land area of about 450 square metres, and built-up area of 350 to 660 square metres. The city's best shopping, eating and entertainment facilities will be within strolling distance of the bungalows.
Shanghai's historical bungalows were built in the 1930s during the French colonial period and were once the residence of high level Chinese leaders. Since then, they have deteriorated in condition.
In late 1999, the Shanghai municipal government issued a directive to conserve historical houses to preserve the city's old charm. The head lease with Somerset represents the first such experiment for the Shanghai municipal government in refurbishing these buildings to such high standards and in making them commercially viable.
Once refurbished as first-class bungalows, the historical houses are expected to fetch rents ranging from US$8,000 to US$12,000 (S$14,000 to S$20,500) a month when they are put on the market in 2002.
In Shanghai, Somerset's presence is prominent through its towering 334-unit Somerset Grand Shanghai serviced residence which is popular with senior level expatriate executives.
In the rest of China, Somerset Holdings has the 169-unit Somerset Olympic Tower serviced residence in Tianjin. The company is scheduled to open its 400-unit Somerset Grand Beijing in the second quarter of next year, and 200-unit Somerset Guangzhou in 2003.
Ida Lim, Vice President
Investor Relations & Corporate Communications
Tel: 65867-230 Hp: 9-628-8339 Fax: 62272-220
Issued by: Somerset Holdings Limited