Taiwan's China Development Financial Holding (2883.TW) has sold its stake in the Taipei 101 building for an T$860 million ($26 million) profit to a unit of Ting Hsin International group, paving the way for the food company to enter the island's property market.
They're still looking for opportunities in Taiwan's property market, a senior executive at Tingyi Holdings (0322.HK) said on Tuesday, referring to the Wei family that owns the Ting Hsin group.
The executive, who declined to be named, added that the group would not seek a seat on the building's board of directors.
Ting Hsin has a 37 percent stake in Tingyi.
Shares of China Development Financial jumped on the news, closing up 5.73 percent on Tuesday at a one-month high, outperforming a 0.98 percent advance by the broader market .
Local media reported that the deal, worth T$3.7 billion, would be the biggest property transaction involving a Taipei skyscraper and foreshadowed future possible fund inflows into Taiwan's real estate market.
Taipei 101 is one of Taiwan's most iconic skyscrapers, and at one time held the accolade of being the world's tallest building.
Separately, the total value of office transactions in Taipei more than doubled in the second quarter on a sequential basis, signalling a thaw in the city's long-stagnant real estate market, property services company DTZ said on Tuesday.
Investments by insurance companies made up much of the quarter's growth, the head of DTZ's Taiwan unit Billy Yen said.
Insurers are sitting on a lot of cash right now, Yen said.
An advance by the local stock market, fund inflows from Taiwanese businesses operating overseas, and Chinese investments could also help boost demand for office space in the second half of the year, he said, but declined to give a forecast.
Many of Taiwan's real estate developers, including Farglory (5522.TW) have experienced a revival amid warming ties with China, as investors bet Chinese investors would be interested in the island's property market.
Farglory shares have surged more than 85 percent in the past two months, far outpacing the main TAIEX share index's 12 percent advance during the same period. (Reporting by Lin Miao-jung, Rachel Lee and Roger Tung; Writing by Kelvin Soh; Editing by Chris Lewis)