New World Development: REIT Spin-off Approved by Shanghai Exchange

New World Development secured approval from the Shanghai Stock Exchange (SSE) for the proposed spin-off and listing of a REIT holding its K11 Art Mall and Atelier NWT properties. The company initially announced the plan on September 17, 2026, and has now received acceptance from the SSE.

The spin-off requires a waiver from strict compliance with Practice Note 15 of the Hong Kong listing rules due to PRC legal restrictions preventing existing shareholders from assured entitlement to REIT units. The Stock Exchange granted this waiver. Upon completion, New World Development’s indirect stake in the underlying asset will decrease from 100% to 20%, removing it from consolidated financial statements.

The transaction may constitute a major transaction, with applicable percentage ratios potentially exceeding 25% but remaining below 75%, triggering shareholder approval requirements. Additionally, New World Development plans to subscribe to 20% of the REIT’s units, potentially qualifying as a discloseable transaction with ratios between 5% and 25%. Further announcements will be made as required by listing rules.

The REIT spin-off continues a strategy announced in prior filings, aiming to unlock value from its Shanghai properties. The company will need to finalize the consideration for the asset disposal and confirm applicable percentage ratios to determine the full scope of shareholder approvals required.