Forterra Trust has entered into a 20-year lease for an additional 3,404 sq m of retail space at Huai Hai Mall in Shanghai, its trustee-manager Forterra Real Estate said on Monday.
This brings the total space at Huai Hai Mall that is under Forterra Trust's control to 11,024 sq m. Forterra currently owns the floors from the basement to level three of the four-storey mall, which is located in Shanghai's central business district.
The new lease agreement comes with an option to extend the lease for another 10 years at Forterra's discretion. No capital commitment is required for the transaction, said Forterra Real Estate.
The lease gives Forterra the right to use, redevelop and lease the additional space, which will form part of the trust's refurbishment plans for the property. The refurbishment is due to start next year.
"As the latest addition to Forterra's commercial real estate portfolio in China, Huai Hai Mall provides an unique opportunity for Forterra to gain a substantial foothold in the exciting and promising Chinese retail sector," said Forterra Real Estate chief executive officer Richard David.
"The enlarged property allows Forterra to further exploit the unique offering this property provides, leveraging our signature strength in strategic asset refurbishment, repositioning and management to deliver a state-of-the-art shopping mall and ultimately to maximise our unitholder value through significant rental reversion and capital appreciation."