Shanghai: Parkson Holdings Bhd's 54.97 percent-owned subsidiary, Parkson Retail Group Ltd (PRGL), has extended the lease of its Shanghai Hongqiao retail property in China for an additional decade, securing the premises until December 31, 2036.

According to BERNAMA News Agency, Parkson announced in a filing with Bursa Malaysia that its indirect wholly-owned subsidiary, Shanghai Hongqiao Parkson Development Co Ltd, has formalized the renewal agreement with Shanghai Changning Real Estate Management Co Ltd. The Parkson Group has a longstanding history of over 30 years in operating and managing department stores in Shanghai, where it enjoys a strong reputation and market presence, leveraging a network of brands, loyal customers, and government connections.

Shanghai remains the nation's most populous financial hub, with the highest per capita disposable income and burgeoning business opportunities, making it a strategically significant location for enterprises aiming to establish their operations in China. The financial terms for acquiring the right-of-use asset, as recognized under International Financial Reporting Standard 16 (IFRS 16), amount to approximately 374.5 million yuan (one yuan = RM0.58).

The transaction is categorized as a very substantial acquisition under the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Ltd, as the highest applicable percentage ratio surpasses 100 percent. The monthly fixed rent for the property is set at 5.19 million yuan from July 1, 2026, to September 30, 2031, and will increase to 5.34 million yuan from October 1, 2031, to December 31, 2036. Additionally, Shanghai Changning Real Estate Management has agreed to provide a total of 10 months rent-free periods during the lease term, alongside two renovation periods totaling six months.