China Logistics Property Holdings Co., Ltd. and LaSalle Investment Management Asia Pte. Ltd. have entered into a cooperation framework agreement whereby CNLP and a fund managed by LaSalle will establish a joint venture to invest up to US$300 million in operating logistics warehousing projects in China.

According to CNLP, it has also granted certain pre-emptive rights to LaSalle in relation to some of its existing logistics assets and developments.

“The cooperation with LaSalle will benefit the group’s long-term development, notably optimizing the capital structure and reducing the operational cost, which will further enhance the financial stability,” said Cheuk Shun Wah, chief financial officer of CNLP. “The fund cooperation model helps accelerate the expansion of our logistics business, which allows us to seize market opportunities more nimbly and maximize profit for our shareholders and investors.”

Under the agreement, CNLP will invest up to US$90 million and be appointed to provide project and property management services to the logistics warehousing projects under the joint venture. The move is part of the company’s aim to achieve revenue diversification, further position itself as a leading logistics facilities operator and transform into an asset-light model.

“Driven by rapid growth of e-commerce and domestic consumption in recent years, demand in the major logistics market has been persistently strong,” said Pan Naiyue, chief executive officer of CNLP. “Having world-class institutional property investor LaSalle join us as business partner is a testimony to the group’s robust business strategy. We are pleased to deepen our cooperation with LaSalle to strengthen each other’s business development.”

At the end of 2017, CNLP’s prime logistics facilities portfolio had a total area of 3.1 million square metres, with 130 logistics facilities operating in 27 logistics parks in 14 provinces and municipalities.