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Alibaba affiliate Ant Group pays US$202 million for second plot of land in its hometown of Hangzhou

By Sandy Li

/ SCMP |

August 18, 2021 2:05 PM SGT

Cover photo: Bloomberg

SINGAPORE (EDGEPROP) - Ant Group, controlled by Chinese billionaire Jack Ma, on Tuesday won a large commercial site in Hangzhou, its second in its hometown for 1.31 billion yuan (US$202 million), according to the city government records. (See also: Alibaba buys 50% stake in AXA Tower, assumes 50% of the loan)

The price of the land in Zhijiang National Tourist Resort Area, West Lake district, which can yield a total gross floor area of 325,795 square metres, works out to 4,035 yuan per square metre. Ant, an affiliate of Alibaba Group Holding, the owner of this newspaper, paid about 22% less than it did for a nearby site it acquired last year.

Ant paid 2.7 billion yuan, or 5,194 yuan per sq metre, for the parcel last October that can yield a total gross floor area of 519,000 sq m. The latest acquisition gives the group a total gross floor area of 845,295 sq m in the district.

The operator of the Alipay online payment platform plans to build its global headquarters on the first site, according to mainland media.

Workers adjust the musical fountain on West Lake, Hangzhou. West Lake is listed as a world cultural heritage site. Photo: Simon Song

Ant Group declined to comment on the latest land acquisition.

Land prices in China have declined after policymakers rolled out a slew of cooling measures to contain the red-hot property market. In Hangzhou, the provincial capital of Zhejiang, rules were tightened in January to stop people from giving away their property to relatives under false pretence to disguise as first-home buyers.

"Ant's new campus will help to anchor the location and create an impetus for further development," said James Macdonald, senior director and head of China research at Savills.

He said that the price for the site was reasonable, noting the price difference between the two sites.

But the demand for land remains high in Hangzhou. The city, which conducted its first land sales of the year in May, sold 57 plots, fetching the government 117.85 billion yuan, with 44 of them reaching the price cap, according to a Savills report from June.

One of the plots was acquired by China Resources in Future Sci-tech City, where most of Alibaba's operations are currently located, for 11.16 billion yuan. It was the first parcel in Yuhang, the largest district in Hangzhou, to sell for more than 10 billion yuan, Savills said.

Located in the city's southwest about 45 minutes from Xiaoshan International Airport, Zhijiang National Tourist Resort Area has many tourism related developments, including Song Cheng, the city's first large scale theme park, and Hangzhou Xihu International Golf course.

The resort area, approved by the State Council in 1992, has since attracted more than 3 billion yuan in infrastructure investment.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2021 South China Morning Post Publishers Ltd. All rights reserved.

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