CapitaLand Investment Limited (CLI) has raised 1.2 billion yuan in equity commitments (US$167.84 million) at the first close of its sixth onshore renminbi (RMB) fund.
Proceeds from the China Business Park RMB Fund III (CBPF III) will be invested in China’s business park sector.
The Singapore-listed real asset manager has secured an onshore major institutional investor as the fund’s anchor investor. The close-ended fund is expected to add 2 billion yuan to CLI’s funds under management (FUM) when fully deployed. CLI will maintain a sponsor stake in CBPF III in line with its asset-light strategy to grow its FUM while keeping strong alignment with its investors and partners.
The firm will recapitalize Ascendas iHub Suzhou by divesting it as a seed asset to CBPF III for 1.4 billion yuan. It will continue to manage the property which will contribute to its recurring fee income.
Ascendas iHub Suzhou is located in Dushu Lake Science & Education Innovation District, which is part of the Suzhou Industrial Park. Since it started operations in 2011, the business park has attracted numerous international and domestic biomedical and IT enterprises.
The property comprises four mid-rise and 11 low-rise buildings with a total gross floor area of approximately 170,800 square metres. It is well supported by a mix of amenities and services and located in close proximity to Suzhou Metro Line 2. Ascendas iHub Suzhou has a Leadership in Energy and Environmental Design Gold certification.
Onshore partnerships
Kara Wang, chief investment officer of CLI China, says: “CBPF III builds on our track record of attracting and cultivating long-term partnerships with domestic investors. The launch of our sixth RMB onshore fund brings the total domestic capital raised to nearly 50 billion yuan since 2021. The recapitalization of Ascendas iHub Suzhou demonstrates the disciplined execution of our strategy to recycle quality assets from our balance sheet into our RMB funds as part of our China for China capital management strategy.
“This marks our second recapitalization this year following the divestment of a 95% stake in Capital Square Beijing into a joint venture. With the government’s continued focus on technology and industrial transformation, we see prime business park opportunities for CBPF III, both from CLI’s portfolio as well as third-party assets.”
CBPF III is a follow-on fund to China Business Park Core RMB Funds I and II (CBPCF I and II) which were launched in November 2022 with a total fund size of about 4 billion yuan. CBPCF I and II have acquired two business parks in Shanghai.
Since the establishment of its first onshore RMB fund, CLI has brought 11 new domestic investors into CLI’s network of capital partners. As of March 31 2024, CLI has a total of 14 private investment vehicles in China with FUM of S$25 billion (US$18.98 billion).
CLI has been operating for 30 years in China, one of its core markets. It has more than 200 properties in over 40 cities with total real estate assets under management of close to S$46 billion in the country. Its portfolio in China includes office, retail, lodging, business parks, logistics and data centres in five core tier-1 and tier-2 city clusters.
Photo: Ascendas iHub Suzhou has attracted numerous international and domestic biomedical and IT enterprises. (CLI)
