Projects

Jiulongjian Luxury Townhouses
Jiulong Scenic Resort, Jiulong Subdistrict, Fangzi District, Weifang City, Shandong Provinces, PRC

Euro Asia holds in its land bank a 200,000 m2Âsite in the Julongjian Park, to be zoned into luxury town housing. The valuation carried out by DTZ in 2010 appraised the site at RMB 250 million (Euro 25.9 million) once zoning approval is received.

As of December 3rd, 2011, the Company had received zoning approval on half of this site, with further applications pending. Euro Asia plans to build 100 luxury town houses on the site at approximately 400 m2 GFA each. Preliminary designs are currently under way, and construction is slated to begin in August of 2011 and to be completed by the fourth quarter of 2012. With regards to the remaining 100,000 m2, construction permits are expected by October, 2011. Euro Asia plans to build a further 100 town houses on the additional site.

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Training and Exhibition Centre
Cloud Lake Park, Shibei District, Anqiu, Weifang City, Shandong Provinces, PRC

Appraisal value: RMB 138 million | Use: 5-star hotel exhibition hall and auxiliary building | Planned GFA: 32,023 m2Â| Land area: 135,459 m22| Designated operator: NIW Real Estate.

At this site on Cloud Lake, Euro Asia is currently constructing a 5-star hotel and exhibition centre. The planned GFA is 32,023 m2Âand as of May 15th, 2011 the glass curtain wall installation has entered its final stages and is nearing completion, and interior improvements have commenced.

On December 3rd, 2010 the Company provided an update on developments, stating that NIW Real Estate, on behalf of Euro Asia, had completed initial negotiations with a Chinese multinational company concerning the formation of a joint venture regarding the Training and Exhibition Center. Under the discussions, NIW's capital investment in the project will be transferred to the joint venture partner, in return for a fixed fee plus a to-be-negotiated percentage of gross and/or net income, along with the hotel's management rights. In return, the partner will invest into the lease hold improvements of the hotel, estimated at RMB 120 million (Euro 12.6 million), and act as its operator. We estimate the management contract negotiation will be completed in May, 2011 and that contract is to commence in July, 2011.

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Yunhu Apartments
Cloud Lake Park, Shibei District, Anqiu, Weifang City, Shandong Provinces, PRC

Anticipated pre-tax profit: RMB 239 million | Use: residential building | Expected start of construction: September, 2011 | Expected date of completion: June 2013 | Land area: 20,000 m2Â| Planned construction area: 103,000 m2Â| Designated operator: NIW Real Estate

Adjacent to the Training and Exhibition Centre, on 103,437 m2Âof land at the lakeside already owned by the Company, Euro Asia is planning the development of six apartment buildings with a total GFA of 103,000 m2.

Total construction costs are estimated at RMB 185 million (Euro 19M), which will be financed internally without debt.

The Company has also signed a preliminary pre-sales agreement with a third-party purchaser for two of the six buildings, for a total of RMB 141 million (Euro 15M). The purchaser has agreed to pay an initial deposit of 30% or RMB 42 million (Euro 4M) upon commencement of construction, a further 20% or RMB 28 million (Euro 3M) upon completion of the superstructure, and the balance of 50% or RMB 70 million (Euro 7M) when the title is passed upon completion.

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Agricultural Machinery Market
13 km from Weizhou Road, Fangzi District, Weifang City, Shandong Provinces, PRC

Use: commercial exhibition centre and auxiliary building | Expected start of construction: March 2011 | Land area for construction: 493,332.8 m2Â| Designated operator: NIW Real Estate

This land is designated for the development of a market for the sale of agricultural machinery and auxiliary equipment. Driven by a government-indicated need for a centralised venue for this type of activity, the Company had originally acquired just under 160,000 m2Âfor this development.

Based on market and government feedback, it has become clear that the area required is substantially larger than was initially thought. The original plan was to produce an agricultural centre catering to the middle-to-high end market, whereas the new plan calls for a medium-priced centre, catering to the complete range of machinery, equipment and agricultural supplies, both domestic and international. Further to the announcement of December 3rd 2010, new plans have been developed and are under way. Euro Asia has entered into discussions with the Fangzi government to acquire a site adjacent to the existing parcel of 333,333.5 m2, increasing the land area by approximately 2.5 times the area of the original site.

Site preparation at the China Agricultural Machinery Marketing Center continues, and a presale permit is expected to be received upon completion of phase I (outer structure), in June, 2011.

Euro Asia has already received preliminary letters of interest from four anchor tenants, and we expect this interest to translate into a purchase commitment in June, 2011. In regards to the additional 333,333.5 m2Âof land adjacent to the site for phase II, Euro Asia expects negotiations to be completed and land permits received by September 30th, 2011 as opposed to March, 2011. This delay is due to continuing negotiation over the land price and plot ratio for phase two. Negotiations are in line with the original estimates for a purchase price of less than RMB 175 million (Euro 18.3 million).

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Xinyuanju Hotel (German Hotel)
Beihai Road and north of Xiwang Village, Fangzi District, Weifang City, Shandong Provinces, PRC

Appraisal value: RMB 76 million | Use: 3-star hotel | Date of completion: 2008 | GFA: 9,359 m2Â| Land area: 27,740 m2Â| Lease income: RMB 6 million p.a. | Lessee: SNI | Lease agreement ends: 30 September 2014 | Development potential: Land use rights (granted till 2047) allow for the development of office space.

The German Hotel was completed in 2008 and is now in use as a three-star hotel. On November 29th, 2010, the Company announced it had entered into a non-binding agreement with regards to the sale of the German Hotel. On April 15th, 2011, Euro Asia completed the land transfer agreement for the German hotel, where it had received a good faith deposit of 8 Million RMB (Euro 0.21 million) by the end of April, 2011, at which point in time the entire deposit became non-refundable. The remaining purchase price balance of 62 Million RMB (Euro 6.5 million) will be received in two instalments of RMB 30 million (Euro 3.1 million) on or before April 15th 2012, and RMB 32 million (Euro 3.3 million) on or before October 15th, 2012. The sale will be completed at a pre-tax profit to the Company of RMB 8 million.

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Yunhu Holiday Hotel
Cloud Lake Park, Shibei District, Anqiu, Weifang City, Shandong Provinces, PRC

Appraisal value: RMB 61 million | Use: 2-star hotel | Date of completion: 2005 | GFA: 6,291.27 m2Â| Land area: 20,000 m2Â| Lease income: RMB 6 million p.a. | Lessee: SNI | Lease agreement ends: 30 September 2014 | Development potential: Land use rights (granted till 2043) allow for the development of office space.

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New Jianye Building (11th to 15th floor)
No.303, Dongfeng East Road, Kuiwen District, Weifang City, Shandong Provinces, PRC

Appraisal value: RMB 35 million | Use: office | Date of completion: 2005 | Land area: 3,382m2Â| Lease income: RMB 3 million p.a. | Lessee: SNI | Lease agreement ends: 30 September 2014 | Development potential: Held for investment purposes.

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Estate of Shengpaihua
No.316A Jiankang East Road, Kuiwen District, Weifang City, Shandong Provinces, PRC

Appraisal value: RMB 32 million | Use: office space | Date of completion: 1999 | GFA: 4,239.63 m2Â| Land area: 2,907.2 m2Â| Lease income: RMB 3 million p.a. | Lessee: SNI | Lease agreement ends: 30 September 2014 | Development potential: Held for investment purposes.

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Eu-Asia Apartments
West of Yuanfei Road, South of Zhongxue Street, Kuiwen District, Weifang City, Shandong Provinces, PRC

Anticipated pre-tax profit: RMB 50 million | Use: residential and commercial building | Expected start of construction: July 2011 | Expected date of completion: December 2012 | Land area: 3623 m2Â| Planned construction area: 18,400 m2Â| Designated operator: NIW Real Estate

Through its subsidiary, Weifang Xinpu, Euro Asia acquired 3,623 m2Âof land in the Kuiwen district—the economic heart of Weifang City—for RMB 15 million. The Company plans for the development of an split-level apartment building with a construction area of 18,400 m2Âfor mixed commercial and residential use. Euro Asia has agreed to terms with a prospective joint venture partner who will assume all development costs of this project, estimated at just under RMB 59 million. In return, the partner will own 50% of the joint venture. Additionally, the proposed joint venture partner will pay RMB 20 million to Euro Asia for its land contribution. To date, Euro Asia has received a total non-refundable deposit of RMB 10 million (Euro 1.0 million) including a good-faith deposit of RMB 2 Million as of December 31st, 2010. The balance of another 10 million RMB will be received upon commencement of construction. Construction for the building is slated to start by July, 2011, with pre-sale commencing in October, 2011. The expected gross sale of the building is estimated at RMB 150 Million (Euro 15.7 Million) and Euro Asia's participation in the venture to be to RMB 50 million (Euro 5.2)

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Qingzhou Apartments
Qingzhou Central Road, Qingzhou, Weifang City, Shandong Provinces, PRC

Anticipated pre-tax profit: RMB 46 million | Use: residential and commercial building | Expected start of construction: Third quarter 2011 | Expected date of completion: end of 2012 | Land area: 14,463 m2Â| Planned construction area: 51,000 m2Â| Designated operator: NIW Real Estate

Through its subsidiary, Weifang Xinpu, Euro Asia acquired 14,463 m2Âof land, with a planned construction area of 51,000 m2Âfor mixed residential and commercial use, at a purchase price of RMB 30 million.

Euro Asia has reached a preliminary agreement with a prospective joint venture partner who will assume all development costs of this project, estimated at around RMB 91.8 million, in exchange for 50% of the joint venture. Additionally, the proposed joint venture partner will pay RMB 40 million to Euro Asia for its land contribution.

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