Real estate developer Mapletree will look to ramp up its logistics presence in China in the next few years to ride on the increased demand created by China's huge One Belt, One Road initiative as well as the burgeoning e-commerce sector.
In an exclusive interview yesterday, the company unveiled its plans to increase its logistics gross floor area across China from 2 million sq m to 4 to 5 million sq m as it caters to its customers' increasing needs.
This expansion move will be implemented in partnership with trade agency IE Singapore.
On Sunday, China pledged to spend US$124 billion (S$173 billion) on One Belt, One Road. Mapletree currently has 5.4 billion yuan ($1.1 billion) worth of completed logistics projects in China, with another 5.3 billion yuan worth in the works.
Mr Goh Chye Boon, regional chief executive of Mapletree China, said: "While we have grown a lot in the logistics development space... in order to cater to what our customers - the e-commerce companies, express delivery firms and cold storage companies - want, we need to follow them to the key hubs they are operating in.
"Most of our customers have established a base in the first-tier cities and are now going into other cities. This provides opportunities for us to scale our logistics operations forward."
On Sunday, China pledged to spend US$124 billion (S$173 billion) on One Belt, One Road.
Mapletree currently has 5.4 billion yuan ($1.1 billion) worth of completed logistics projects in China, with another 5.3 billion yuan worth in the works.
Its initial focus was on central and eastern China in cities such as Shanghai and Beijing, but this next wave will focus on cities further west, tapping China's "Go West" strategy, Mr Goh said.
"In the last two years, we have expanded the most into western China. The bulk of our investment goes into Chengdu and Chongqing where the growth has been phenomenal... We have the most number of logistics projects in Chongqing, with a total of six, as well as four more in Chengdu."
Mr Goh added that the firm will also be targeting key hubs in the north and south in order to leverage on the demand from cross-border trade.
"For example, in the south, Kunming, a vital hub for South-east Asian countries due to the cross-border trade, is our latest target. We managed to get a location close to the airport, which allows us to serve not only the local population but also the demand from South-east Asia."
IE Singapore will be a facilitator and adviser to Mapletree as it expands its logistics footprint in China.