CapitaLand Investment Limited (CLI) has established its first onshore renminbi (RMB) fund in China, in partnership with a domestic asset management company. In line with CLIâ€™s asset-light strategy to grow its funds under management (FUM), it holds a 12% stake in the RMB700 million (S$144 million) fund.
Capitalising on a special situation opportunity arising from Chinaâ€™s current market environment, the fund is acquiring a quality office building in Shanghai at an attractive price. The transaction is expected to be completed in July 2022.
Mr Puah Tze Shyang, CEO of China, CLI, said: â€œChina is a core CLI market and the successful launch of our first onshore RMB fund is testament to CLIâ€™s competitive edge as a leading global real estate investment manager with about 30 years of on-the-ground experience in China. 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.â€
Mr Simon Treacy, CEO of Private Equity Real Estate, Real Assets, CLI, said: â€œCLIâ€™s first onshore RMB fund will further expand our private fund management business, one of CLIâ€™s key growth drivers. We are increasing our fundraising channels by tapping on Chinaâ€™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. Our inaugural RMB fund also builds on CLIâ€™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.â€
CLIâ€™s private fund management business has been gaining traction with nine private funds incepted since 2021, raising over S$1.9 billion of third-party capital to invest in various asset classes globally including new economy, office and student accommodation sectors. CLIâ€™s private funds, listed funds and lodging management businesses will together drive growth in FUM and fee-related earnings. Globally, CLI has 260 investment and asset management professionals.
CLIâ€™s presence in China
CLI has a strong portfolio of more than 200 properties across over 40 Chinese cities with total assets under management of S$46 billion. Its resilient and well-diversified portfolio in China includes integrated developments, office, retail, lodging, business parks, logistics and data centres in five core Tier one and two city clusters. CLI has a staff strength of about 6,600 in China.