Metro Holdings

[Boon]

i bet they mostly likely able to renew the lease.
property lease be it residential or commercial are short term in nature
there are many more residential property even nearer the end of their lease...does it mean the people will get chased out?

Anyway, its a bit premature to talk about the lease now right?
Here are the 5 properties and when their leases run out.

EC Mall, Beijing 50 year term from 2001 (2051)
Metro City, Shanghai 36 year term from 1993 (2029)
Metro Tower, Shanghai 50 year term from 1993 (2043)
GIE Tower, Guangzhou 50 year term from 1994 (2044)
Frontier Koishikawa Building, Tokyo Freehold

Earliest is 2029, 15 yrs away.
Kinda early to be speculating about whether leases will be renewed. China in 15 yrs will be a very different animal.
Obviously management feels confident enough to do a major refurbishing works for their properties currently, taking a short term hit in earnings and rentals to maximise longer term returns.

I noticed that Metro’s 60% interests in Shanghai Metro City and Shanghai Metro Tower are held through “joint controlled entities”.

I have seen JV with term of 20 years only (shorter than the land tenure of the properties owned) and was not renewable - with foreign interests in the JV revert to the Chinese partner at expiry.

Hence, the terms or contractual agreements of the JV are also critical

Not sure on the disclosure standards/requirements on these JV interests.