HANG LUNG PPT(HK:00101) Xin Lang Cai Jing·2025-12-12 14:21Core Viewpoint - The closure of Meilong Town Isetan after 26 years has led to the announcement of a new commercial project at the same location by Hang Lung Properties in partnership with Shanghai Jiubai Group, which will transform the site into a vibrant mixed-use complex [1][16]. Group 1: Project Details - Hang Lung will operate the Nanjing West Road 1038 commercial project under a 20-year lease, increasing its total building area by approximately 44% to about 312,335 square meters [1][16]. - The project will involve a joint investment of 2.2 billion yuan for renovations, aiming to create a landmark that includes retail, hotel, and office spaces [1][16]. Group 2: Historical Context - Meilong Town Isetan was a prominent high-end shopping destination in Shanghai since its opening in 1997, representing a blend of Chinese and Western commercial styles [3][18]. - The shopping center was part of the "Mei Tai Heng Golden Triangle," which included Hang Lung Plaza and CITIC Pacific, but lost its appeal over time, leading to its closure [3][18]. Group 3: Market Strategy - The new project will focus on attracting a younger consumer demographic and will not continue the heavy luxury branding of its predecessor, indicating a shift towards high-quality experiential spaces [4][19]. - Hang Lung's strategy reflects a broader trend in the Chinese market where emotional value is prioritized over traditional luxury branding [4][19]. Group 4: Investment Outlook - The acquisition of the Meilong Town site signals Hang Lung's confidence in the Shanghai market, particularly in the Jing'an district, where it now operates three projects [6][21]. - The Nanjing West Road area has shown strong commercial performance, with Hang Lung's existing properties contributing significantly to local tax revenues and attracting numerous international brands [7][22]. Group 5: Urban Development - The redevelopment of Nanjing West Road has been part of a larger initiative to enhance the area's commercial landscape, supported by government efforts to attract quality developers and operators [9][24]. - The project aligns with Hang Lung's "V.3 strategy," which emphasizes optimizing existing assets rather than expanding into new areas, marking a significant milestone in its market leadership [8][23].