CapitaLand Investment (CLI) has established its first onshore RMB fund in China. The fund was established in partnership with a domestic asset management company.
CLI will hold a 12% stake in the RMB700 million ($144 million) fund.
The fund will be acquiring a quality office building in Shanghai at an attractive price, capitalising on a “special situation opportunity” arising from China’s current market environment.
CLI’s private fund management business, which was incepted in 2021, has raised over $1.9 billion of third-party capital to invest in various asset classes globally including new economy, office and student accommodation sectors.
Its private funds, listed funds and lodging management businesses will together drive growth in funds under management (FUM) and fee-related earnings.
CLI also has a portfolio of over 200 properties across 40 cities in China with total assets under management (AUM) of $46 billion as at March 31.
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“China is a core CLI market and the successful launch of our first onshore RMB fund is testament to CLI’s competitive edge as a leading global real estate investment manager with about 30 years of on-the-ground experience in China,” says Puah Tze Shyang, CEO of China, CLI.
“Our proven deal sourcing capabilities, understanding of the market and supportive ecosystem of domestic capital partners have enabled us to access, structure, and execute unique off-markets deals. Through our extensive local expertise and presence, we are able to continue to extract value from the current market environment by being able to physically source for counter-cyclical opportunities, allowing us to build on our growth momentum in China,” he adds.
“CLI’s first onshore RMB fund will further expand our private fund management business, one of CLI’s key growth drivers. We are increasing our fundraising channels by tapping on China’s domestic capital, which we believe represents a deep pool of investable capital that enables CLI to further build on its experience and track record in the country,” says Simon Treacy, CEO of private equity real estate, real assets, CLI.
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“Our inaugural RMB fund also builds on CLI’s fund management track record, demonstrating our ability to offer investors a suite of investment options with high quality returns. We will look at launching more RMB funds, and work with both our domestic and international network of capital partners to capture special situation as well as other investment opportunities in China, across different asset classes,” he adds.
Shares in CLI closed 1 cent lower or 0.26% down at $3.81 on June 21.
