Zhong An Real Estate : Announcements and Notices - Discloseable Transaction Successful Bid for Land

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眾安房產有限公司

ZHONG AN REAL ESTATE LIMITED

(incorporated in the Cayman Islands with limited liability)

(Stock Code: 672)

DISCLOSEABLE TRANSACTION SUCCESSFUL BID FOR LAND

The Board is pleased to announce that on 23 December 2015, Zhong An Group made a successful bid for the land use right of the Land Parcel through open tender auction organised and held by Hangzhou Land Resources Bureau.

As one of the applicable percentage ratios is greater than 5% but less than 25% for the purpose of Rule 14.07 of the Listing Rules, the Land Acquisition Transaction constitutes a discloseable transaction for Company under the Listing Rules and is therefore subject to the notification and announcement requirements under the Listing Rules.

INTRODUCTION

On 23 December 2015, Zhong An Group made a successful bid for the land use right of the Land Parcel through open tender auction organised and held by Hangzhou Land Resources Bureau at the Land Grant Price for residential purpose. Hangzhou Land Resources Bureau and Zhong An Group have entered into the Bid Confirmation confirming that Zhong An Group has successfully bid for the right to acquire the land use right in respect of the Land Parcel at the Land Grant Price.

DETAILS OF THE OPEN TENDER AUCTION

Date: 23 December 2015 Parties: (1) Hangzhou Land Resources Bureau, a government body in the PRC and is responsible for, among other things, administrating the approval of land planning, assignment and transfer of the land use right of state-owned land in Hangzhou

(2) Zhong An Group

To the best of the knowledge, information and belief of the Directors having made all reasonable enquiry, Hangzhou Land Resources Bureau and its ultimate beneficial owner(s) are Independent Third Parties.

Surety paid in order to become a qualified bidder ( 競買保證金 ):

A sum of RMB54,200,000 was deposited with Hangzhou Land Resources Bureau as surety, which will be applied as the Deposit (as defined below)

Land Grant Price: RMB271,320,000 (equivalent to approximately HK$226,544,060)

Pursuant to the terms set out in the auction notice of the Land Parcel, Zhong An Group shall pay 50% of the Land Grant Price as deposit ("Deposit") within one month from the date of the Bid Confirmation and the remaining 50% of the Land Grant Price shall be paid within one year from the date of the Bid Confirmation

Land for transfer: The Land Parcel

Term of land use right: 70 years, pursuant to the information as set out in the Tender Auction Announcement

Use and development of the Land Parcel:

For residential purpose with a size of the Land Parcel being 13,597 sq. m. and total gross floor area of the buildings to be constructed on the Land Parcel not exceeding approximately 33,993 sq. m.

Performance Surety: Pursuant to the information set out in the Tender Auction Announcement for the Land Parcel, a performance surety of RMB13,566,000 (being 5% of the Land Grant Price, but no greater than RMB20 million ("Performance Surety")) shall be paid upon the payment of first instalment of Land Grant Price. 50% of the Performance Surety will be refunded upon the commencement of the construction on the Land Parcel according to the date stipulated in the Land Use Right Grant Contract and after approval. The remaining 50% of the Performance Surety will be refunded upon the completion of construction and after approval

Other principal terms:	1.	Pursuant to the Bid Confirmation, Zhong An Group have to enter into the Land Use Right Grant Contract before 4 January 2016, failing which Hangzhou Land Resources Bureau will cancel the right to acquire the land use right of the Land Parcel
2.	Pursuant to the information set out in the Tender Auction Announcement:

• The Land Parcel will be handed over to Zhong An Group within 3 months from the date of full settlement of the Land Grant Price

  
  

• Construction shall be commenced within one year from the date of hand over of the Land Parcel and shall be completed within 3 years

  
  

• A lot of land of about 3,401 sq. m. annexed to the Land Parcel shall be built as a road according to relevant requirements by Zhong An Group and shall be transferred to the District Municipal Garden Utilities Management Office* ( 區市政園 林公用事業管理處 ) of Xiaoshan District, Hangzhou at nil consideration

LAND GRANT PRICE

The Land Grant Price (also being the value of the Land Parcel taken by the Group) was arrived as a result of a successful bid by Zhong An Group through an open tender auction. Such price was determined having taken into account the current property market conditions of Hangzhou, Zhejiang Province, the PRC and the development potential of the Land Parcel.

The Land Grant Price will be funded by the Group's internal resources.

REASONS FOR THE TRANSACTION

The Land Parcel is located in one of the core areas of Xiaoshan District of Hangzhou with easily accessible transportation network and amenities. There are bus stops, a station of Route 5 of Hangzhou Metro (to be operated in 2019), schools, supermarkets, Zhejiang Xiaoshan Hospital* ( 浙江蕭山醫 院 ), Xiaoshan Library* ( 蕭山圖書館 ) and Xiaoshan Opera House* ( 蕭山歌劇院 ) in the proximity. Furthermore, it is next to a plot of land which is designated for residential property development and the land use right of which is held by Zhong An Group. The Directors believe that the Land Acquisition

Transaction will generate a synergetic effect upon development of these two plots of land as a whole. It will also increase the land reserve and geographical coverage which is in line with the strategy of the Group.

The Directors are of the view that the terms of the Land Acquisition Transaction are fair and reasonable and in the interests of the Group and the Shareholders as a whole.

INFORMATION ON THE COMPANY

The Company is an investment holding company. The principal activities of the Group are property development, leasing and hotel operation in the PRC and Canada.

REQUIREMENTS UNDER THE LISTING RULES

As one of the applicable percentage ratios is greater than 5% but less than 25% for the purpose of Rule

14.07 of the Listing Rules, the Land Acquisition Transaction constitutes a discloseable transaction for the Company under the Listing Rules and is therefore subject to the notification and announcement requirements under the Listing Rules.

DEFINITIONS

In this announcement the following expressions shall, unless the context requires otherwise, have the following meanings:

"Bid Confirmation" the land use right bid confirmation ( 成交確認書 ) confirming the successful bid by Zhong An Group of the right to acquire the land use right in respect of the Land Parcel at the Land Grant Price

"Board" the board of Directors

"Company" Zhong An Real Estate Limited, an exempted company incorporated in the Cayman Islands with limited liability, the shares of which are listed on the Stock Exchange

"Director(s)" the director(s) of the Company

"Group" the Company and its subsidiaries

"Hangzhou Land Resources Bureau"

Hangzhou Land Resources Bureau (Xiaoshan Branch)* ( 杭州市國土資源 局蕭山分局 )

"HK$" Hong Kong dollar(s), the lawful currency of Hong Kong

"Hong Kong" The Hong Kong Special Administrative Region of the PRC

"Independent Third Party(ies)"

third party(ies) (and its/their ultimate beneficial owner, where applicable) are third parties independent of the Company and connected persons (as defined in the Listing Rules) of the Company