Annual Report 2008Annual 00817 (Incorporated (Incorporated in Hong Kong with Limited Liability) Stock Code:
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FRANSHION PROPERTIES (CHINA) LIMITED Annual Report 2008 FRANSHION PROPERTIES (CHINA) LIMITED Rooms 4702-4703, 47th Floor, Office Tower, Convention Plaza, No. 1 Harbour Road, Wan Chai, Hong Kong Contents 2 Corporate Information 3 Financial Highlights (Incorporated in Hong Kong with limited liability) 4 Chairman’s Statement Stock Code:00817 8 Major Events 12 Honors and Awards 14 Business Review 60 Financial Review 68 Investor Relations Report 70 Corporate Social Responsibility Report 74 Profile of Directors and Senior Management 78 Corporate Governance Report 85 Report of the Directors 101 Independent Auditors’ Report 103 Audited Financial Statements 110 Notes to Financial Statements 176 Five-Year Financial Information Annual Report 2008 Brief Overview of Each Project Property Development Projects (Under development and Completed) Hotel Operations Projects Brief Overview of Each Project Site B of Shanghai Shanghai Zhuhai Every The Ritz-Carlton, Westin Beijing, Grand Hyatt Port International International Garden Project Sanya Chaoyang Shanghai Cruise Terminal Shipping Service Zhuhai Every Garden The Ritz-Carlton, Westin Beijing, Grand Hyatt Shanghai Project Center Project Project is located on the Sanya is located in Chaoyang is located is located on the Shanghai Port Shanghai International north section of Lover’s Yalong Bay of Sanya, in the Yansha 53rd to 87th floors International Cruise Shipping Service Center Road in Zhuhai and has Hainan province. It commercial area of of Jin Mao Tower. It Terminal is located on the Project is located on the a total gross floor area was officially opened Chaoyang district, was officially opened west bank of the Huangpu North Bund of Shanghai, of approximately 137,225 in April 2008 with a Beijing, and is in 1999, with a total river of Shanghai, it directly across the river sq.m. It comprises a total gross floor area adjacent to the gross floor area of is adjacent to the Bund, and directly across from the area of Lujiazui. The west side of the site complex of thirteen 8 to 31-storey residential of approximately 83,000 sq. m. It has 450 embassy district. It was officially opened in approximately 80,410 sq. m. comprising the river from the Oriental Pearl TV Tower, is adjacent to Shanghai Port International Cruise apartment buildings. With the unique “New guest rooms, including 21 luxury suites June 2008, with a total gross floor area of 555 luxury guest rooms. It comprises a it is designed to be a commercial complex Terminal, the two projects will form a riverside Athenism” design concept and a grand sea and 33 villas with distinctive amenities approximately 75,446 sq. m. The hotel has grand ball room which can accommodate development project comprising a cruise area that doubled the length of the Bund. view, this project has become an innovative such as private swimming pools and 34 floors, comprising 566 guest rooms, a 1200 people, a ball room which can terminal and office buildings. This project is The zone will be used for offices, commercial high-end residential property in Zhuhai and is housekeepers. It has an indoor conference function room of 720 sq. m. and 7 smaller accommodate 800 people and more than divided into Site A and Site B, Site A will be complex, convention facilities, hotels and service nominated as “The Real Estate Project with space of 1,700 sq.m. specially designated conference rooms with the most advanced 10 function rooms. It was the venue for developed into a cruise terminal and shipping apartments, with other facilities including a yacht the Higest Brand Value in Zhuhai, PRC”. This for business conference, large seminar audio visual technology. It has received major international events such as “Wealth service buildings and Site B will be developed marina. This project features the marina, creating project was completed in 2008 and its sales and other special occasions, and it has the numerous international heads of states, Forum”, “APEC Conference” and other as a commercial complex comprising office a riverfront modern office and commercial zone record has been good. Further details are set only outdoor sea-view wedding auditorium sports and business elites, including the high-level forums and conferences. It is buildings, art gallery, and a music and cultural which matches its marine theme. This project out on page 29 of this annual report. in China, and the Ritz-Carlton spa with Former US President George W. Bush named the “Best Super Deluxe Hotel in centre. We hold economic interest in the Site B comprises the Eastern Site, the Central Site and an area of 2,788 sq.m. It was named and his family during the Beijing Olympic China”. Further details are set out on page development and expect to have a total gross the Western Site and is expected to have a total “Asia’s Leading New Hotel” in the World Games and was highly acclaimed. It has 48 of this annual report. floor area of approximately 302,080 sq.m. upon gross floor area of approximately 527,720 sq.m. Travel Awards as soon as it commenced been awarded “the Best New Hotel in the completion. Construction works of the site Construction works of this project commenced in operations. Further details are set out on World in 2008”. Further details are set out commenced in May 2004 and are expected to be 2008 and are expected to be completed in 2012. page 40 of this annual report. on page 44 of this annual report. completed in 2009. Further details are set out Further details are set out on page 22 of this on page 20 of this annual report. annual report. Property Development Projects (Reserve) Hilton Sanya Wangfujing Grand JW Marriott Resort & Spa, Hotel Shenzhen Jin Mao World Jin Mao Yulong Shanghai Chong Hainan Heritage Park Snow Mountain Ming Island Project Wangfujing Grand JW Marriott Shenzhen The Hilton Sanya Hotel is located at the is located in Futian Redevelopment Resort Hotel Shanghai Chong Ming Resort & Spa is north of Wangfujing District, Shenzhen. Project Project Island Project is located located at Yalong Street, and it was The construction Jin Mao World Heritage Jin Mao Yulong Snow in a riverside leisure Bay Resort. Opened opened in 1995. This of the hotel was Park Redevelopment Mountain Resort Hotel sport and residential in 2006 and with 14-storey hotel has completed in Project is located in Project is located in community in Chenjia a total gross floor 405 rooms as well as January 2009, and the former site of Ganhaizi of Lijiang Town, Chong Ming area of approximately 76,666 sq.m., it has a number of conference rooms, dining and has commenced operation on trial basis Lijiang World Heritage Yulong Snow Mountain, Island, Shanghai, with a 501 guest rooms, suites, villas and a 400 other facilities. The hotel has a total gross in the same month. It has a gross floor Park, Yunnan province, with a site area of Yunnan province, with a site area of site area of approximately 220,000 sq.m. The metres long, white and fine beach. The floor area of approximately 41,349 sq. m. area of approximately 52,000 sq. m., with approximately 333,330 sq.m. The project approximately 54,241 sq.m. The project will Group has also leased an adjacent site with hotel has 6 restaurants and a conference The hotel was designated as a receiving 411 guest rooms, a ball room which can aims to combine the Naxi culture with be developed into a super five-star luxury a site area of approximately 955,478 sq.m. centre of 3,000 sq. m. It was named as “the hotel during the Beijing Olympics Games accommodate 400 people and 5 conference international design concepts, building the hotel with an estimated total gross floor area The Group plans to develop the leased site Best Resort in China”. Further details are period, and its quality service is highly rooms with the most advanced audio visual most characteristic high-end resort hotels of approximately 16,000 sq.m. Further details into a golf course and the granted site into an set out on page 50 of this annual report. acclaimed in the industry. It was awarded equipment. The hotel aims to become the and villas in China with an estimated total are set out on page 26 of this annual report. integrated riverside, luxury leisure and resort the “Favorite Brand Hotel For Foreign top luxury five-star hotel in Shenzhen with gross floor area of approximately 100,000 complex comprising a golf club, villas, hotels Customers”. Further details are set out on its distinguished design and quality service. sq.m. Further details are set out on page 26 and timeshare hotels. Further details are set page 52 of this annual report. Further details are set out on page 54 of of this annual report. out on page 27 of this annual report. this annual report. Property Investment Projects Our Hotel Brands Beijing Chemsunny Jin Mao Tower Sinochem Tower World Trade Centre Jin Mao Tower is located Sinochem Tower is Beijing Chemsunny in Lu Jia Zui, Shanghai’s located in Beijing on World Trade Centre is major financial and Fuxingmen Wai Street, located on Fuxingmen business centre, and right at the heart of Nei Street and is has become a prominent the financial centre. adjacent to West landmark in China. Sinochem Tower has Chang An Street, with Jin Mao Tower has 88 26 floors, comprising a gross floor area of floors, 420.5 metres in a gross floor area height and comprises a total gross floor area of approximately 49,066 sq.m., which Production - SNP Vite approximately 194,530 sq.m. It consists of three parallel and interconnected 14-storey of approximately 292,475 sq.