ESR AR 2019 EN

Notes to the Consolidated Financial Statements 31 December 2019 213 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS ESR Annual Report 2019 35. INTERESTS IN THE UNCONSOLIDATED STRUCTURED ENTITIES As at 31 December 2019, the Group considers its equity investments in 31 (2018: 20) investment funds to be interests in unconsolidated structured entities. The investments funds are designed so that the management rights are not the dominant factor in deciding who controls them and are financed through the issue of ownership interest instrument to each investors. The Group also acts as investment manager for 34 (2018: 24) real estate funds to manage the operations of those assets to earn fee income based on their capital contributed by investors, development costs incurred on real estate projects, or for the acquisition advisory service and brokerage service. The assets have been designed so that voting and similar rights are not the dominant factor in deciding how the investing activities should be conducted and are financed through the issue of ownership interest instrument to investors. The Group did not provide any financial support and has no intention of providing financial or any other support. The Group earned a total gross fee income of USD73,651,000 (2018: USD44,621,000) from the real estate funds for the year ended 31 December 2019. As at 31 December 2019, the Group’s maximum exposure to loss as a result of acting as the investment manager of the real estate funds was equivalent to the carrying amount of fee income receivable from them amounting to USD42,399,000 (2018: USD25,785,000) and the carrying amount of the investments amounting to USD499,146,000 (2018: USD275,160,000). 36. DISPOSAL OF SUBSIDIARIES During the year ended 31 December 2019, Action Wealth International Limited, Shanghai Dongjin Shiye Co., Ltd., Jiadong Investment Ltd., Talent HK Offshore Limited, Action Growth International Limited, E-shang Wealth HK Limited and Action Rocks Holding Limited, wholly-owned subsidiaries of the Company, entered into an agreement with Shanghai Yishang Logistics Equity Investment Partnership (“Xinhua Fund”) to dispose of the 99.99% interests in seven subsidiaries, which are Hangzhou Mingpu Supply Chain Management Co., Ltd., Shanghai Yita Warehousing Co., Ltd., Xinbin (Shanghai) Qiye Guanli Fuwu Co., Ltd., Shanghai Moya Warehouse Co., Ltd., Tianjin Mingcheng Warehouse Co., Ltd., Shanghai Donghe Warehouse Co., Ltd. and Wuhan Mingju Supply Chain Development Co., Ltd..