SINGAPORE (Jan 3): A Perennial Real Estate-led consortium has taken the first step to develop US$1.2 billion ($1.61 billion) worth of integrated healthcare property mega mixed developments in China linked by high speed railway (HSR) network.

On Wednesday, Perennial HC Holdings, the joint venture vehicle, announced the closing of the first capital commitment of US$500 million.

Perennial, through its subsidiary, will hold a 45% stake in the JV. The remaining stakes will be held by Shun Tak Holdings with a 30% stake, Bangkok Bank with a 10% stake, a subsidiary of BreadTalk Group with a 5% stake, an investment vehicle of Kuok Khoon Hong with a 4% stake, S1F with a 4% stake, and a subsidiary of Wilmar International with a 2% stake.

Perennial says its stake in the first closing amounted to US$225 million, which will be funded progressively through internal cash and bank borrowings.

Positioned as one-stop regional healthcare hubs, the HSR-linked healthcare integrated mixed-use developments, typically measuring between 300,000 sqm to 800,000 sqm in total gross floor area (GFA), are expected to host healthcare real estate featuring core medical/healthcare facilities designed to cater to both domestic and international clientele.

This includes various types of specialised hospital, such as general hospital, women’s and children’s hospital, geriatric hospital and rehabilitation hospital, as well as medical centres, eldercare homes and nursing homes. In addition, there will be complementary medical and healthcare-related services, including diagnostic centres, pharmacies and genomic laboratories.

The HSR healthcare integrated mixed-use developments are also expected to comprise other real estate components such as hotels, retail, serviced apartments, offices, and small office home offices to support a multitude of communities, including residents of the city and from other cities within the province, patients and customers, medical and healthcare professionals, as well as other local and international patrons from the medical, business and tourism industries.

The JV will target Tier One or strong Tier Two cities and provincial capitals in China with close proximity to transportation hubs, particularly HSR stations, which will provide easy access to subways and/or HSR to serve large cities or provinces with sizeable population catchments.

In connection with the JV, Perennial and Shun Tak will set-up an asset and project management company and a hotel management company to manage the developments.

Pua Seck Guan, Chief Executive Officer of Perennial, says, “Perennial currently has two existing HSR projects in Chengdu and Xi’an. With the establishment of this US$1.2 billion Joint Venture Vehicle, we are excited about the potential to grow our HSR portfolio to up to eight projects with a total GFA of over 4 million sqm, positioning Perennial as a leading player with the largest HSR portfolio.”

This story, written by PC Lee for The Edge Singapore, first appeared on Jan 3.