Net revenues for China Growth Development, Inc. (OTCBB: CGDI) were up about 8 percent over the same quarter last year to $3.73 million, but operating expenses increased 49 percent for the commercial real estate company in the same period to $2.55 million. About $880,000 of that was incurred in the closing of a reverse acquisition transaction, though the same financial report also stated that net income decreased about 64 percent to $1.15 million from the same quarter in 2007.
The company’s reverse merger was with China mall owner and operator, Taiyuwan Rongan Business Trading Company, Limited. TRBT shareholders became the majority shareholder of CGDI stock and the consolidated entity.
“We are pleased with our second quarter results,” said CGDI COO Ning Liu. “… We have a solid development program for additional commercial spaces in Taiyuan and we are optimistic that we will successfully acquire rights to a very valuable land bank. These valuable development rights are unlikely to be duplicated in Taiyuan, as it is not possible to create more land.”
Lui said future prospects looked positive based on four factors:
• Shopping centers in prime locations
• Employees with extensive commercial real estate experience
• Payment innovations to reduce accounts receivable, such as full lease-term prepayment
• Land banking to acquire additional popular and profitable land for future development.
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