ARA Asset Management has agreed to acquire a 50% stake in Dasin Retail Trust’s trustee-manager and 5% of the trust’s units in a deal that would extend its reach into China’s Greater Bay Area (GBA). 

Dasin, with assets under management (AUM) of 11.6 billion yuan (US$1.8 billion), has a portfolio comprising of seven retail malls in high-population catchment areas with limited competition in Zhongshan, Zhuhai and Foshan.

Under the sale and purchase agreement, ARA forms a strategic partnership with Zhongshan Dasin Real Estate, the sponsor of the trust. Zhongshan Dasin is one of China’s  premier commercial real estate companies, having completed over six million square metres of retail, residential, commercial and hospitality development projects.

Commenting on the deal, ARA Group chief executive officer Moses Song says: “China is a key market for ARA, and the excellent growth prospects of the Greater Bay Area, in particular, appeal to us considerably. We are fortunate to have found a credible, high-calibre partner in Zhongshan Dasin to help us expand our footprint in this region, and we look forward to growing our new venture together.”

One of the fastest-growing regions in Greater China, the GBA is poised to become an economic powerhouse for China over the next decade. In 2019, the government issued a development plan which aims to build a vibrant and extensive bay area that can compete with the world’s top megacities by leveraging the combined advantages of Guangdong, Hong Kong and Macau.

The acquisition provides ARA with immediate exposure to the region, riding on the post-Covid long-term fundamentals in China’s retail space and continued rising urbanization in Tier-3 GBA cities, the company says.

ARA is a pioneer in the real estate investment trust (reit) industry in Singapore and Hong Kong, and one of the largest reit managers in Asia-Pacific. Together with its associates and partners, ARA Group currently manages 11 public reits in Singapore, Hong Kong, Japan and Australia with total AUM of over S$46 billion (US$34.7 billion).