BUSINESS OVERVIEW

The business development of the Group’s major operating subsidiaries are as follows:

(I) Property development and investment in Suzhou

In 1990, the Suzhou municipal government commenced to develop the western part of Suzhou, known as the New District. In 1991, Mr. CF Tao commenced property development and property investment business of the Group in Suzhou by establishing the principal operating subsidiary of the Group, namely Suzhou Garden Villa Development and Management Co. Ltd ("SGVDM"). SGVDM is a Sino-foreign co-operative joint venture company owned as to 95% by New Heritage Development Limited, a subsidiary of the Group and as to 5% by Suzhou New District Development Company, which is a State-owned enterprise established in Suzhou.

The Group was one of the first foreign developers to develop residential apartments and villas within the New District. From 1992 to 1998, a total of three phases of Suzhou Garden Villa which comprise a total GFA of over 70,000 sq.m. had been developed. Suzhou Garden Villa is situated on the main road and has become one of the popular banking and commercial regions in the New District and is regarded as one of the well-established residential areas in the New District of Suzhou.

Following the completion of Suzhou Garden Villa, SGVDM commenced the construction of Suzhou Garden Court in 2002. Suzhou Garden Court comprises a total GFA of over 59,000 sq.m. and the project was completed in 2004.

In March and May 2005, SGVDM commenced the construction of Suzhou Garden Towers and Suzhou Garden Place respectively. Suzhou Garden Towers and Suzhou Garden Place comprised a total GFA of over 30,000 sq.m. and 7,000 sq.m. respectively. The two projects were completed in mid-2006 and Dec 2005 respectively.

(II) Property development projects since 2005/2006

(a) Wuzhong Garden Court
The piece of land was acquired in October 2005 and a total GFA of approximately 62,000 sq.m. had been built.

(b) Taihu Garden Court
The piece of land was acquired in March 2007. Development has been split into 3 phases and a total GFA of approximately 90,000 sq.m. will be built.

(c) Lakeside Garden Court
This piece of land was acquired in December 2007. Development has been split into 4 phases and a total GFA of approximately 154,000 sq.m. will be built upon completion.

(d) Wuzhong Commercial Building
This piece of land was acquired in August 2007. Design work is still underway. Expected a total GFA of approximately 58,000 sq.m. will be built.

(III) Intended property development in places other than Suzhou

In addition to its existing property development business in Suzhou The Group will also explore opportunities in other cities Jiangsu Province as well as other up and coming third to fourth tier cities.