Irish firm nets €1.2bn Chinese development deal

DUBLIN-based Treasury Holdings yesterday announced a €1.2 billion joint venture to develop a 900-acre island site off the coast of China.

It is thought to be the largest single property development project ever undertaken by an Irish firm.

The development will include residential, leisure, office, retail and conference facilities.

The leisure segment will include a golf course, hotels, restaurants, a marina and a water sports centre "which will all combine to create a comprehensive entertainment destination."

Taoiseach Bertie Ahern, who received a preview of the plans from Treasury principals John Ronan and Richard Barrett in Shanghai yesterday, said the development was "on a massive scale."

Mr Ahern is in China leading an Enterprise Ireland trade mission to the country.

While investors have yet to be lined up for the Treasury project, the company has reached agreement with a Chinese partner to develop the site on Chongming island, a few kilometres off the coast of Shanghai, on a 50-50 basis.

Treasury named its partner as the Dongtan Company, but did not wish to reveal any further details. Dongtan is the 900-acre area of Chongming island on which the development will take place.

Dongtan Company is understood to be Shanghai Chongming Dongtan Investment & Development Co Ltd, one of several companies owned by Shanghai Industrial Investment (Holdings) Co (SIIC), a group which claims to be "the biggest and best-resourced enterprise" operating out of the city.

SIIC boasts consolidated assets of over 35 billion Hong Kong dollars (€3.45 billion) and reported profits for the first six months of 2004 of HK$930 million (€92m).

Its chairman is Cai Lai Xing, a former local government mandarin with formidable contacts in the Chinese Communist Party (CCP), among them the country's former president, Jiang Zemin, and former premier, Zhu Rongji.

Dongtan is listed for development in China's national strategy, and, according to a statement made on a company website by Mr Cai, has received "importance and focus from state leaders."

The state owns or heavily invests in many large enterprises in China, but Treasury yesterday refused to divulge whether the government was involved in its project. Development director Robert Tincknell said negotiations had not yet been concluded and were at a sensitive stage.

However, he said he hoped work would commence by the end of the year, and that the development would open in phases in time for the 2010 World Expo, which is being held in Shanghai.

Already, the local authority has begun construction on 22km of bridge and tunnel which will link the island to the mainland.

It is Treasury's first project in China. However, Mr Tincknell said Treasury was "always on the look-out diversifying our portfolio around the world."

Treasury said its portfolio is currently worth over €1.5bn.

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