Mayer Brown advises ESR on joint venture with Chinachem to develop logistics facility in Hong Kong and the lenders providing debt financing backing the successful bid for the Kwai Chung site
Mayer Brown advised ESR Group Limited (ESR) (HKEX Stock Code: 1821), through its wholly-owned subsidiary, on the formation of a joint venture with Chinachem Group (Chinachem), with a total capital commitment from shareholders of up to HK$14 billion (approx. US$1.79 billion), to develop a prime cold storage and logistics facility in Kwai Chung, Hong Kong.
ESR is the largest real asset manager in Asia Pacific. In partnership with Chinachem, a leading property developer in Hong Kong, ESR plans to develop a seven-story facility on the site to answer the growing demand for storage space driven by the rise of e-commerce in Hong Kong.
Last month, ESR won the rights to the 55,245 square-meter site through a government tender, which Mayer Brown also advised on.
A club of five lenders comprising UOB, SMBC, MUFG, OCBC and CITIC Bank will provide the term loan facilities to fund the winning bid by ESR. The successful execution and delivery of this financing as well as the joint venture formation, which Mayer Brown advised on in just three weeks, is a testament to the strength and depth of the firm’s capability in the real estate sector.
The Mayer Brown team representing ESR was led by Hong Kong-based Real Estate finance partners Peter Ho and Eugene Wong and included: Real Estate - associate Noah Chung; and Corporate & Securities - partner Chester Wong, and associates Andrew Koon and Inez Ma.
The team representing the syndicate of lenders comprised Banking & Securities partner Doos Choi, counsel Ester Chow, associate Adrian Chiang, trainee solicitor Beatrice Tsang, and Real Estate partner Alvin Yeung.