Press Release
[For Immediate Release]

KWG Property Holding Limited
Announces 2016 Annual Results

Solidified Position in Higher-tier Cities
Gross Margin well Protected above Industry Average
Profit Attributable to Owners of the Group Amounted to RMB3.46 Billion

(22 March 2017 - Hong Kong) KWG Property Holding Limited ("KWG Property" or the "Group", 1813.HK), one of the leading property developers in Guangzhou, announced today its annual results for the year ended 31 December 2016.

During the year under review, the Group recorded total revenue of approximately RMB8,865 million, representing an increase of 6.3% when compared with the corresponding year in 2015. Gross profit reached approximately RMB3,070 million, representing an increase of 2.0% over the corresponding year in 2015. Gross profit margin stood at 34.6%. Profit attributable to owners of the Group reached approximately RMB3,465 million. Core profit amounted to approximately RMB2,922 million, representing an increase of 12.6% year-on-year. Earnings per share were RMB115 cents. The Board of Directors recommended RMB40 cents per share as the final dividend and special dividend per share of RMB11 cents for the year ended 31 December 2016.

In 2016, China's property market went through a roller-coaster ride, as buying enthusiasm dominated for some time in the earlier part of the year, before gradually normalize. The property market had been trending up since mid-2015 in the wake of policy relaxations yet more notably in the beginning of 2016, pent-up demand started to be unleashed in a blowout. Halfway through the year, the sustained exuberance further translated into rather out-of-control price escalation. Property transaction finally began to slow down after the Central Government had reintroduced austerity measures in the fourth quarter to curb over-heated market conditions in tier-one and tier-two cities. Record-breaking sales in property led to soaring land prices. Due to the shortage in land supply in tier- one cities, unfilled land demand shifted to higher tier-two cities, where developers were jumping on the bandwagon to acquire land.
During the year, the Group launched products to meet customer's needs and completed its annual sales targets thanks to the strategic positioning in tier-one and tier-two cities over the years. In terms of pre-sales contributions, approximately 51% of the pre-sales were contributed by Guangzhou, Beijing and Shanghai, while the remaining 49% were contributed by higher tier-two cities, notably Hangzhou, Chengdu and Nanning.

The Group focused on launching new phases from exiting projects after obtaining thorough market analysis. A variety of new products were launched in popular regions to replenish saleable resources in response to heightened buyers' interest. Products launched by the Group during the year were mainly units with GFA of 89-130 sq.m designed for end-users and first- time upgraders. These were complemented by larger unites with GFA of 150 sq.m. or above.

On the financial side, the Group closely monitored changes in financing policy and market window, as it successfully issued domestic corporate bonds at favourable interest rates in March and April, respectively, through its wholly-owned subsidiary Guangzhou Tianjian Real Estate Development Limited, to raise proceeds of RMB8,700 million in aggregate. In the latter half of the year, three tranches of non-public domestic corporate bonds with lower interest rates were also issued in July and September through KWG Property Holding Limited to raise a total of RMB11,300 million. In January 2017, the Group issued a USD250 million senior note to replace USD senior notes issued in previous years with higher coupon rates. Such issues have significantly lowered the financing costs and improved the debt profile, while gradually reducing the proportion of offshore bonds to lessen foreign exchange exposure.

In regards to land bank, to continue with its stance in tier-one and higher tier-two cities over time, the Group acquired 12 sites located variously in Guangzhou, Foshan, Shanghai, Hangzhou, Nanning, Chengdu and Hefei during the reporting period to facilitate expansion in scale and sustain future development. During the year, the Group acquired new sites with an attributable GFA of approximately 2,374,000 sq.m. As at 31 December 2016, the Group owned 67 projects in 12 cities across China with an attributable land bank of approximately 11.3 million sq.m., sufficient to meet the Group's development need in the next 4-5 years.

The Group's hotel business and investment properties achieved steady growth during the year. The Group has five hotels in operation, including Four Points by Sheraton Guangzhou, Sheraton Guangzhou Huadu Resort; W Hotel Guangzhou and The Mulian Hotels in Guangzhou and Hangzhou. After years of improvements, these hotels have built solid reputation and enjoyed steady growth in revenue by maintaining and expanding customer bases through premium services and business-friendly environments.

The Group launched U Fun, the green shopping centre in Xinjiangwan, Shanghai and Tian Hui Plaza, a high-end shopping mall in the Pearl River New Town, Guangzhou during the year, in addition to office properties for lease in various cities. The launch of commercial projects is set to contribute stable cash flow to the Group on an on-going basis. Since its opening, IFP has been able to maintain a high occupancy rate consistently for long period because of its convenient location at the heart of Pearl River New Town and excellent property management services. IFP reported an occupancy rate of 98.8% as at 31 December 2016 as it continued to stay atop peers in the region in terms of occupancy rate.

Looking ahead, Mr. Kong Jian Min, Chairman of the Group stated that, "In 2017, we are scheduled to launch a great number of brand new projects in Guangzhou, Shanghai, Foshan, Nanning and Hangzhou. There will include Zhucun Project in Guangzhou, Songjiang Project in Shanghai, Beijiao Project in Foshan, Wuxiang New City Project IV in Nanning, Xiaoshan Project and Shenhua Project in Hangzhou. The new projects will comprise mainly residential for end-users and upgraders. In the meantime, we will also look to launch new phases of existing projects which have been quite established in their respective local markets, such as The Summit in Guangzhou, Oriental Bund in Foshan, Sky Ville in Chengdu, The Moon Mansion in Hangzhou and The Core of Centre in Nanning, to ensure timely replenishment of saleable resources."

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About KWG Property (HKSE stock code: 1813)
Established in 1995, KWG Property is one of the leading property developers focusing on mid to high-end properties with premium quality in prime locations in Guangzhou. Going through 22 years of development, the Group has an efficient property development system, as well as a balanced product portfolio which includes mid- to high-end residential properties, serviced apartments, villas, office buildings, hotels and shopping malls. Currently, the Group has expanded to high potential markets outside of Guangzhou. A strategic development framework has been formed, with Guangzhou, Foshan, Hainan and Nanning as its hub for South China, Suzhou, Shanghai, Hangzhou, Nanjing, Hefei and Xuzhou for East China, Chengdu for Southwest China, Beijing, Tianjin for North China, Wuhan for Central China and the Group's footprint has been expanded to Hong Kong since this year.

Issued by Cornerstones Communications Ltd. on behalf of KWG Property Holding Limited. For further information, please contact:

KWG Property Holding Limited
Hoffman Tsui / Linda Wu / Roger Law/Sandra Huang
Tel: (86) 20-8550 0828 / 8550 0262 / (852) 2655 1933/ (852) 2655 1918
Fax: (86) 20-8550 0990 / (852) 2878 7091
Email: hoffmantsui@kwgproperty.com / lindawu@kwgproperty.com / roger_law@kwgproperty.com / sandra.huang@kwgproperty.com