Baker & McKenzie Advises as Lead Counsel on Yuexiu Real Estate Investment Trust’s Proposed Investment in Guangzhou International Finance Center
Deal Announcement
30 May 2012
Hong Kong, China, 30 May 2012 – Baker & McKenzie is advising the Yuexiu Group, a long-standing client of the Firm, on the proposed investment by Yuexiu Real Estate Investment Trust (“Yuexiu REIT”) in Guangzhou International Finance Center (the “Property”).
The Property, which is currently owned by Yuexiu Property Company Limited (“Yuexiu Property”) (a significant unitholder of Yuexiu REIT), is one of the ten tallest skyscrapers in the world and a landmark building strategically located in the central business district of Guangzhou. The Property, which has an appraised value of approximately RMB15.37 billion as at 31 March 2012, is a premium mixed-use commercial development comprising a shopping mall, a Grade A office building, a 5-star hotel, luxury serviced apartments and car parks. The transaction will be financed by way of bank financing, proceeds of a unit placement and issuance of consideration and deferred units to Yuexiu Property.
The Baker & McKenzie team was led by Hong Kong-based Corporate partner, Dorothea Koo. Corporate partners Cheung Yuk Tong and Milton Cheng also provided support on corporate and REIT regulatory aspects. The team is acting as lead counsel on the transaction with primary responsibility for drafting the transaction agreements, legal/regulatory structuring, regulatory liaison and general transaction management. It is also acting for Yuexiu REIT on the acquisition financing for the deal.
Commenting on the transaction, Dorothea Koo said, “We are delighted to be able to assist the Yuexiu Group on this significant transaction. Our close working relationship with the client, combined with our public company M&A, REIT, regulatory and finance expertise, enabled us to work with the client and its joint financial advisers to navigate through the complex structural and regulatory issues.”
Milton Cheng, head of the Firm’s REIT practice in Hong Kong/China and head of the Asia-Pacific M&A practice group added, “The acquisition marks a significant new phase in Yuexiu REIT’s growth strategy. It is also a good signal for the H-REIT market. We are excited at being able to support both Yuexiu Property and Yuexiu REIT on their continued growth and development.”
The joint financial advisers to the REIT Manager are (in alphabetical order) BOCI, Goldman Sachs, J.P. Morgan, Morgan Stanley and Standard Chartered.
Baker & McKenzie’s Asia-Pacific REIT Group has been at the forefront of ground-breaking REIT transactions in Asia. The team has been involved in almost all of the significant transactions to date involving REITs listed or with assets in Hong Kong – including Hui Xian REIT’s IPO, being the first RMB denominated REIT to be listed in Hong Kong; Fortune REIT’s dual primary listing in Hong Kong by way of introduction; Fortune REIT’s IPO, follow-on acquisitions and financings; The Link REIT’s medium-term note programme and its property acquisitions; Champion REIT’s IPO and follow-on acquisitions; Yuexiu REIT’s IPO and follow-on acquisitions; Regal REIT’s follow-on acquisitions; Prosperity REIT’s IPO and follow-on acquisitions and financings; Sunlight REIT’s IPO; and RREEF China Commercial Trust’s IPO.
The team has also advised on numerous other significant REIT-related deals in the Asia-Pacific – Prospect REIT Investment Corporation on its merger with Japan Rental Housing Investments Inc., Tower REIT’s IPO, Fubon No. 1 REIT’s and Fubon No. 2 REIT’s IPOs, MacarthurCook Industrial REIT’s IPO, Tokyo Growth J-REIT’s IPO, ARA Asset Management’s IPO, YTL Corporation’s acquisition of interests in Macquarie Prime REIT (now known as Starhill Global REIT) and Starhill Global REIT’s first acquisition in Australia.