Singapore-based real estate developer and fund manager Ascendas has raised and deployed S$333 million (€229.5 million; $247.89 million) for a private real estate fund for industrial and business park assets in China.
The entire equity raised via Ascendas China Business Parks Fund 4 (ACBPF 4) was invested in a portfolio of business park assets located in Shanghai, Suzhou in eastern China and Xi’an in the country’s northwestern region – namely the Ascendas Lotus Business Park in Shanghai, and the Ascendas Innovation Towers development project in Xi’an. The firm’s development portfolio in the Suzhou Industrial Park, one of its flagship projects in China, was presented as a seed asset in the fund.
“As China’s economic development progresses towards higher value-added activities, it presents attractive opportunities to participate in the growing business park sector in key cities, Manohar Khiatani, president and group chief executive officer of Ascendas said in a statement. “The business park sector in the identified cities will also benefit from the improved infrastructure network as well as the growing trend of companies looking at business parks to optimize their space usage.”
Ascendas holds a 23 percent sponsor stake in the fund. Other institutional investors in the fund include European pension funds and Singapore institutions such as Singapore Press Holdings and ImmoFinRE Group, an alternative investment management firm.
On the firm’s investment history in China, its chief executive officer, Wong Wing Kien, said: “Ascendas has been operating in China for about 20 years with an experienced team in real estate investment, asset management and development management. We are committed to leverage on our track record and ground presence to deliver attractive yields, stable income and capital growth to our investors.”
In March last year, Ascendas formed a real estate partnership with Ping An Trust, a subsidiary of Ping An Insurance, to make investments in China and other Asian markets. The size of the partnership was not disclosed.
The firm has also been expanding its footprint in other Asian markets. To further its investment portfolio in Vietnam, it signed an agreement with Saigon Bund Capital Partners– a joint venture between the private equity real estate firms Gaw Capital Partners and NP Capital Partners – in September last year to develop a business park in the country. The cost of the development project is expected to be $130 million.