Large Commercial Project, MEGA MILLS in Fangjiayao, Shanghai (2011 to Present)
Basic facts:
MEGA MILLS project is the first high-end integrated commercial building that is independently operated, invested, sold and managed by Pearl River Real Estate Group. The positioning of this project takes international brand discount retail as theme, takes high-end fashion shopping as the main body, supplemented with dining, entertainment, tourism and other formats; the project covers a total area of about 350 mu.
Entrusted by Pearl River Real Estate Group, the Group’s on-site merchant team composed of our lawyers, business management center and financial center has gone to the site in Shanghai, to be responsible for starting operation and investment negotiation of this project. The preliminary preparatory work mainly includes: 1. signing “Entrusted Operation and Management Contract” with the operation and management team to define the rights and responsibilities, operational objectives and rewards and punishments of the property owner and the management party; 2. reviewing and amending the series of investment template documents submitted by the operation and management team, including letter of intent, joint sales contract, lease contract, property management agreement, integrated management services agreement and shop manual, etc.; 3. developing relevant reviewing, approval, signature processes and regulatory systems; 4. training the investment-inviting staff of the operation and management team. Later operational work mainly includes: 1. negotiating with Hyatt Hotels Corporation on establishing Hyatt Hotel in Fangjiayao and the hotel management contract; 2. negotiating with Pearl River Cinema to prepare the lease contract; 3. dealing with the competition complaints raised by Shanghai Brilliance Corporation to Qingpu Economic Committee, Shanghai.
Lawyer’s remarks:
The project’s specific operations team is a newly established company under the Group Company. The Outlets Commercial Plaza operated by Brilliance Corporation, the famous department store operator in Shanghai is opposite to this project, thus forming a most direct confrontation. Therefore, the success of this project mainly depends on two points: 1. whether a scientific and standardized management system can be established; 2. how to attract other shops through the settlement of famous brands. As for the first point, we mainly achieve the objective through developing the approval submitting and auditing procedures of related processes, preparing series of investment template documents and doing a good job in training; as for the second point, the overall strategy is to provide famous brand shops with deduction rate and benefits of rent, location selection, renovation subsidies and others, to attract other shops through the settlement of famous brand shops, and to strictly control the business conditions of ordinary brand shops, thus achieving the maximization of rental income.
