Zall Development Acquires 51% Interest in Zhen An to Jointly Develop a First-grade Commercial Building in Wuhan's CBD

Enhanced Presence in Wuhan's First-grade Commercial Property Market

HONG KONG, Aug. 22, 2011 /PRNewswire-Asia/ -- Zall Development (Cayman) Holding Co., Ltd. ("Zall Development" or the "Group", SEHK stock code: 2098), a leading developer and operator of large-scale, consumer product-focused wholesale shopping malls and commercial properties in China, announced today that it acquired a 51% interest in Zhen An Wuhan Company Limited ("Zhen An") for a consideration of RMB523,680,000 (approximately HK$637,755,288). Zhen An, a company established in the PRC with limited liability, is principally engaged in property development and sales of properties in the PRC. Zhen An is the holder of a land use rights certificate to a parcel of land in the central business district (CBD) of Wuhan. The land has a total site area of approximately 10,000 square meters and a total planned GFA of over 97,000 square meters. All the necessary permits and approvals in relation to the planning, construction and development of the land have been obtained. Under the development plan, the land is to be re-developed into a first-grade commercial building. It is currently under construction and is expected to be completed in 2013.

Pursuant to the agreements, Zall Development will acquire the entire issued share capital of Zhen An Properties Limited ("Zhen An Properties") from Chen Kai Holdings Limited ("Chen Kai") through Zall Development Hong Kong, a wholly owned subsidiary of Zall Development, for a consideration of RMB519,790,000. Zhen An Properties owns 48% interest of Zhen An. The Group has also entered into an equity transfer agreement with Huiyu Real Estate Company Limited ("Huiyu Real Estate") via Zall Development Wuhan, a wholly owned subsidiary of the Group. Under the agreement Zall Development Wuhan will acquire from Huiyu Real Estate a 3% interest in Zhen An for a consideration of RMB3,890,000. The acquisitions will be financed by internal resources of the Group. Upon completion of the acquisition, Zall Development will own an aggregate of 51% interest in Zhen An. The Group will enter into a joint venture agreement with Huiyu Real Estate to jointly develop the land through a profit/loss-sharing arrangement in proportion to the companies' shareholding in Zhen An.

Mr. Yan Zhi, Chairman and CEO of Zall Development, said, "We are pleased to have obtained the land use rights certificate through this acquisition. The parcel of land is located in an advantageous geographical location in the central business district of Wuhan, the so called 'Central Wuhan', and is surrounded by China Construction Bank Building in its north, Bank of China Building in the south, New World Trade Centre and New World Department Store in the west, and China Minsheng Bank Building in the east. Upon completion of the construction, the property will be named 'Zall Yulong International Finance Center' and will be positioned as a high-end commercial center and a first-grade office building. As one of the major cities strategically located in Central China, Wuhan boasts a rapidly growing economy and its demand for high-end commercial properties is immense. We believe this acquisition will expand the Group's presence in the first-grade commercial property market in Wuhan, and create synergies with the Group's existing business in the city. Leveraging our competitive edges, we will endeavor to expand the Group's revenue streams and enhance shareholders' value."

About Zall Development

Zall Development is a leading developer and operator of large-scale, consumer product-focused wholesale shopping malls and commercial space provider in China. Headquartered in Wuhan, Hubei, Zall Development primarily engages in selling and leasing consumer product-focused wholesale market properties and other commercial spaces with major clients as suppliers, manufacturers, dealers and other small- to mid-sized local wholesale enterprises. Besides wholesale market properties, Zall Development also offers a comprehensive range of integrated logistics and trading facilities and services.

Major projects and land bank of Zall Development are mainly located in Wuhan, Xiangyang and Tianjin. Its properties portfolio comprises of wholesale market properties, commercial properties and complementary residential properties. The Company's flagship project, the North Hankou International Trade Center ("North Hankou"), is the largest consumer products interstate-trading platform in China. According to Savills and in terms of planned GFA with land use right, the North Hankou project is the most sizable consumer products-focused wholesale market comprising more than ten niche wholesale markets focused on leather footwear, small household items, hotel products and supplies, cotton knitwear, apparel, textile and home appliances, international brands, commodities, gift and accessories, and automobile, etc.

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