Tesco to launch Chinese shopping center expansion

London Tesco is to invest about 100 million pounds ($165 million) in a joint venture with a group of Asian investors to build three large shopping center developments in China, according to a report in the Financial Times.

Britain’s biggest supermarket operator will form a 50-50 joint venture with HSBC Nan Fung China Real Estate Fund, Metro Holdings of Singapore and Nan Fung Group of Hong Kong.

One of the sites to be included in the joint venture will be Tesco’s first Chinese shopping center development, a 500,000-sq.-ft. retail, entertainment and residential center at Fushan. The partnership will also open two other malls in Northern China.

Each mall will have a Tesco hypermarket as its anchor tenant, with two of the centers being mixed-use developments. The structure aims to allow Tesco to expand in China in a capital-efficient way.

If the first centers are successful, Tesco said it could roll out a series of malls in China.