Shangri-La Complex Commercial and Trade Center in Diqing

Name

迪庆香格里拉市综合商业贸易中心项目
Shangri-La Complex Commercial and Trade Center in Diqing

Industry Involved

Modern Service Industry

Site

Shangri-La, Diqing Tibetan Autonomous Prefecture

Overview

Shangri-La Complex Commercial and Trade Center will follow the regional development plan of Shangri-La to maintain and promote regional ethnic characteristics; with the support of Shangri-La’s tourism resources and favorable geographic location of project site, the project is aimed to build an integrated service zone driving commercial development and enhancing tourist connotation, and bring core development dynamic to the commercial and trade industry of Diqing Autonomous Prefecture. This project is of great significance to speeding up the business and economic development of Diqing Autonomous Prefecture and strengthening its social stability.

Content

Shangri-La Complex Commercial and Trade Center is proposed to be constructed on the west of the Middle Section, Changzheng Avenue, Shangri-La after removing existing old buildings inside the existing repair shop, and will cover a land area of 24.51 mu and a floor area of 45838.13 m², including existing floor area of 5712.27 m² and new floor area of 40125.86 m² (total underground area of 9271.46 m²).

Supporting Conditions

This project is richly endowed with location advantages by its prime location in Shangri-La, which is very favorable for the project construction. As an keystone urban development object of Shangri-La, the project coincides with the urban planning of Shangri-La and is given sufficient urban development land quota; additionally, the project site enjoys convenient transportation conditions and well geographical conditions. Project planning and feasibility study report preparation have been completed now, with project proposal approved and commencement conditions ready.

Investment Estimate and Fund Raising

Investment estimate: total planned investment of RMB 107,700,000, including construction cost of RMB 88,561,500, equipment purchase cost of RMB 10,189,200, equipment installation cost of RMB 421,700, other construction cost of RMB 2,707,700, reserve fund of RMB 5,094,000 and working capital of RMB 725,900.

Fund raising: self-raising by enterprise

Preferential Policies Applicable

Interim Provisions of Diqing Prefecture on Foreign Investment Promotion (DZBF [2015] No. 97)

Market Prediction (Analysis)

Earnings in the project are mostly from apartment and store rent, business income of hotel and open shopping mall. In the Center, 324 apartments will bring annual rent of RMB 7,776,000 based on the rent of RMB 2000/apartment/month; 140 stores will give annual rent of RMB 11,200,000; 74 hotel rooms will generate annual income of RMB 8,751,200 calculated as the average price of RMB 360 and the annual occupancy rate of 90%; the open shopping mall will produce annual revenue of RMB 13,511,500 as per RMB 5.34/m² and total area of 6925.28m². To sum up the above, the total annual income will reach RMB 41,238,700.

Profit Model and Preliminary Benefit Analysis

After the completion and operation, the project is expected to generate normal annual sales revenue of RMB 41,238,700, business tax and surcharge of RMB 3,337,500, annual income before tax of RMB 15,264,900 and annual net profit of RMB 11,448,700, with total rate of return on investment of 14.72%, profit ratio of investment of 14.17% and profit and tax investment ratio of 19.89%. This project will have the financial internal rate of return (FIRR) after investment tax of 11.41% and the payback period after investment tax of 8.17 years, FIRR of capital fund of 11.41% and average break-even point of 39.71%.

Risk Analysis

Diqing Autonomous Prefecture is a Tibetan autonomous prefecture inhabited mainly by Tibetan, Lisu and other minorities, so local custom, religion and architectural characteristics must be taken into full account in the planning, design and construction of commercial complex to promote harmonious development.

Cooperation Pattern

Joint venture and cooperation

Contact Information

Contact Unit: Bureau of Commerce of Diqing Prefecture

Contact Person: He Jianyu, Li Canpeng and Long Shuqin

Tel.: 13988710898 0887-8297247

Fax: 0887-8229166

E-mail: 1045506252@QQ.com