CHINA. In big breaking news, property giant Swire Properties is to partner with CDF Investment & Development Co. Ltd (CDFID), a subsidiary of China Tourism Group Duty Free Corporation Limited (CTG Duty Free) to develop a retail landmark in Sanya, Hainan Province.
The mega development, located in the heart of Haitang Bay National Coastal Recreation Park, will be the company’s eighth large-scale commercial development in the Chinese Mainland. Swire Properties and CTG Duty Free (parent of China Duty Free Group, the world’s number one travel retailer according to The Moodie Davitt Report’s industry benchmark ranking) will each hold a 50% interest in the project.
A joint venture company has been established to develop the site as a premium, resort-style, retail-led development, including underground parking and other ancillary facilities. The investment was announced yesterday after the joint venture company successfully acquired (via government land listing-for-sale) a site for commercial development in the Haitang District of Sanya, at a total price of RMB1.308 billion (US$179 million). The project is expected to be completed in phases from 2024.
“We are very pleased to be partnering with CTG Duty Free on this significant retail property development in Sanya,” said Swire Properties Chief Executive Tim Blackburn. “Thanks to its tropical climate and abundant natural resources, and accelerated by the Hainan Free Trade Port policy, Sanya has fast become one of the most popular travel and leisure destinations in China.
“This site presents an exciting opportunity to develop a high-quality retail complex to satisfy the growing demand for a premium retail experience in the region.
“In addition, the 20th CPC National Congress’s report proposed to accelerate the development of the Hainan Free Trade Port, while promoting quality development and strengthening the fundamental role of consumption in the country’s economic growth. I am confident that, with this policy support and in partnership with CTG Duty Free, we will create a world-class retail landmark which will further elevate Hainan’s standing as a regional tourist destination.”
“We look forward to collaborating with Swire Properties in Sanya to jointly develop a world-class, upscale commercial project,” said CTG Duty Free Chairman Peng Hui.
“This new development will have positive synergy with Phases I and II of the Sanya International Duty Free Complex and provide a premium retail experience alongside duty free shopping in the area.
“We believe this combined experience will enrich Sanya’s travel and leisure offerings, further attracting overseas visitors and putting Haitang Bay on the map as a tourist and shopping destination.”
“This will be our first ever resort-style retail complex. The design will embrace Sanya’s tropical coastline and unique ecological landscape, whilst taking inspiration from the traditional fishing settlements of the indigenous Dan community,” said Swire Properties Director, Retail Han Zhi.
“With the 22km coastline along Haitang Bay as a backdrop, we intend to curate a unique experience featuring premium retail with arts and cultural elements to create a major luxury travel destination in Hainan.”
The new development, located in Haitang District, will be Phase III of the Sanya International Duty Free Shopping Complex, covering a total site area of approximately 200,000sq m. The site enjoys excellent road, rail and air connectivity to Sanya Phoenix International Airport and Sanya Railway Station. The new development will also be connected by a network of bridges to the Sanya International Duty Free Shopping Complex, China’s leading duty free location by turnover.
Background to a powerhouse partnership
Hainan Province is the largest special economic zone in China. The development of the Hainan Free Trade Port (FTP) commenced in 2020 and a pan-island customs clearance operation will be set up by the end of 2025. Sanya is a key component of the strategy to develop Hainan into a high-level free trade port and an international tourism and consumption hub.
This new project in Sanya is part of Swire Properties’ strategic plan to invest a total of HK$100 billion (US$12.7 billion) in its core markets, including Southeast Asia, Hong Kong and the Chinese Mainland, to drive the Company’s future growth over the next ten years.
Approximately HK$50 billion will be invested in the Chinese Mainland, with an aim to double the company’s attributable gross floor area in the region. Apart from Sanya, this year Swire Properties has announced Taikoo Li Xi’an and is exploring two potential retail-led projects in Liwan District, Guangzhou and Pudong District, Shanghai.
Footnote: China Duty Free Group President is delivering a keynote address followed by an interview with The Moodie Davitt Report Chairman Martin Moodie at next week’s Trinity Forum in Singapore (1-2 November).
Coming soon
In July The Moodie Davitt Report launched a new quarterly eZine called The Moodie Davitt China Travel Retail Report. The cover story was dedicated to China Tourism Group. Click on the image above to read the bi-lingual title. The next edition will be published in November and will focus on the 28 October opening of the CDFG-run Haikou International Duty Free Shopping Complex and the blockbuster Swire Properties deal in Sanya announced this week.
Uniquely, the publication will be produced by a pioneering joint venture with Hainan Hinews Media Co, the provinces’s leading mainstream media company. The publishing giant commands a total audience of more than 26 million people in China across its multiple print and digital platforms, including the New Hainan App, WeChat, Weibo, Douyin and Kuaishou.
The company, which is The Moodie Davitt Report’s strategic partner in Hainan, has its own dedicated duty free channel, which features regular store, brand, activation and promotional profiles, interviews and other stories.
Hainan Hinews Media Co will be on location at this Friday’s big opening, producing exclusive footage and interviews for the partnership. This will be married to The Moodie Davitt Report’s own detailed analysis of this seminal opening in China’s travel retail history.
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*Please email Kristyn@MoodieDavittReport.com for a free first-year subscription to The China Travel Retail Report. For editorial details please contact Martin Moodie at Martin@MoodieDavittReport.com.
