Chinese tycoon to invest $1.7 bn on Australian property
14 Aug 2014
Wang Jianlin, China's richest man and the chairman of one of the country's largest real estate developers Dalian Wanda Group, has pledged to invest $1.7 billion in Australian real estate sector, further quickening its overseas expansion.
The investment will include the construction of a $900-million beachfront luxury hotel and apartment known as 'The Jewel' on Queensland's Gold Coast.
The Jewel is designed to contain three high-rise buildings comprising a resort hotel, apartments, office and recording studio, park, conference rooms, restaurants and cafes with a total area of about 147,000 square metres.
The project is Beijing-based Wanda's fifth overseas hotel development.Wang's family owns 100 per cent of Dalian Wanda.
According to 2014 Hurun report, Wang is the country's wealthiest person with a net worth of around $25 billion. In August 2013 Forbes had ranked him as the richest person in China with $14 billion.
In a statement to the Australian Securities Exchange (ASX), Wanda said it would pay for the new Gold Coast development through internal resources and a mixture of debt and equity.
The Chinese investment in Queensland is targeted towards the rapid growth in the number of Chinese tourists in the state.
The Gold Coast is one of the world's top ten tourist destinations, and according to Wanda website, about 22 million tourists visited the city in 2013, with 415,000 of them coming from China, growing 24 per cent year-on-year.
''Importantly, spending by Chinese visitors to Queensland grew even faster, up about 28 per cent on the previous year,'' tourism and transport forum executive Trent Zimmerman said.
''These are critical factors in the decisions we are seeing from Chinese investors,'' he added.
Welcoming Wanda's decision, the Australian minister for trade and investment Andrew Robb said that Wanda Group had identified Australia as a priority market during a recent trade mission.
''The addition of a new luxury Chinese hotel brand to the Australian market will have benefits across Australia's tourism industry,'' he said.
The project is expected to begin construction next year and open in 2018.
Hong Kong-listed Wanda Group is a Chinese conglomerate with businesses in real estate, tourism, hotels and entertainment.
In recent times, Wanda has accelerated its overseas development and the company plans to build at least 15 luxury hotels worldwide by 2020.
Wanda has been on an acquisition spree in recent years. In 2012, the company bought US-based AMC Entertainment Holdings for $2.6 billion, thus becoming the world's largest operator of movie theaters.
In June 2013, Wanda acquired British property assets including yacht builder Sunseeker International. (See: China's Dalian Wanda to invest $1.6 bn in London property and yacht-maker Sunseeker).
Separately, the Wanda group is aiming to become the biggest multi-platform entertainment company in the world by building 200 children's theme parks in China by 2020, competing with US giants Dreamworks and The Walt Disney Co.
Other Chinese firms are also showing growing interest in Australia's tourism infrastructure sector, with prospective investment of at least $20 billion.
The ASF Group, a consortium of Chinese investors has committed to develop a cruise ship terminal, casino and hotel while property developer Greenland Holdings Group plans to build a new casino and entertainment complex in partnership with Australian entertainment major Crown Resorts.
Hong Kong magnate Tony Fung plans to build a mega hotel-casino complex near Cairns. At Ella Bay, north Queensland there is another proposal for redevelopment of a farm area into a resort and residential complex.