Financial Street Holding has announced in Hong Kong that its wholly-owned subsidiary Beijing Jinsheng Real Estate Development Company has signed a 20-year lease agreement with Galeries Lafayette (China).
Under the agreement, the French high-end department store operator Galeries Lafayette will open its first Asian department store at Xidan Plaza in Beijing's Financial Street area.
Galeries Lafayette (China) is reportedly a joint venture established by French Galeries Lafayette and Hong Kong IT Limited, with each party owning a 50% stake. Located on Xidan Street North, Xidan Plaza in the Financial Street area has a commercial area of nearly 50,000 square meters, which will be completely leased by Galeries Lafayette (China) for 20 years. The new Galeries Lafayette department store in Beijing is expected to complete construction at the end of 2011 and will be officially open in 2013.
Gao Liang, deputy general manager of Financial Street Holding, told local media that they will take a certain ratio of the annual sales of Galeries Lafayette department store in Beijing as the rent, but the specific percentage is now unavailable.
Galeries Lafayette (China) plans to invest CNY300 million in this project. Philippe Houze, chairman of Galeries Lafayette, said that the group will open 10 to 15 department stores in China in the next few years.
Galeries Lafayette currently has 61 department stores around the world and its total operating area is 500,000 square meters. In 2009, its retail sales reached EUR2.554 billion.