SINGAPORE (Aug 14): CapitaLand has been awarded two prime residential sites in Guangzhou, China for RMB2.05 billion ($409.3 million).

The two sites measure up to about 150,000 sqm in total and the group intends to build around 1,300 homes on the sites by 2021 that will cater to first-time home buyers and upgraders.

The residential sites are located in Zengcheng District, which is set to be the engine of Guangzhou’s industrial growth and the site of the city’s future second international airport. It is also part of a mature residential zone and is surrounded by amenities such as malls, schools, a hospital and other residential developments.

The China government plans to grow the district’s population to 2.1 million by 2020 from the current 1.15 million.

This is the group’s second acquisition in China in less than three months, following its acquisition of a mixed-used development site in Chongqing earlier in June.

Lim Ming Yan, president and group CEO of CapitaLand, says, “CapitaLand remains optimistic about the prospects of China’s residential market, where strong housing sales have continually contributed to the Group’s earnings.”

“In the first six months of 2018, CapitaLand has exceeded our full year capital recycling target of S$3 billion – a strong show of discipline and focus in unlocking value through our active portfolio reconstitution strategy. We are therefore looking forward to deploying these gains into higher yielding investments, such as this land bid in Guangzhou. CapitaLand will continue with our disciplined investment strategy to augment our land bank in fast-growing Chinese cities on a sustainable basis, while targeting an optimal mix between trading and investment properties,” adds Lim.

Shares in CapitaLand last traded 7 cents lower at $3.24.