White Peak Real Estate, a China-focused European real estate investment firm, has raised $75 million for the first close of its third private equity real estate fund.
White Peak Real Estate Investment III, the third in the series of opportunistic vehicles raised for property investments in China, was launched in June with a fundraising target of RMB$2 billion (€281.4 million; $314 million).
White Peak declined to comment on fundraising. However, PERE has learnt that the firm raised the first capital from three institutional investors from the Nordic region. All three investors committed to White Peak's prior two funds. The National Pension Fund of Sweden is believed to be the anchor investor in White Peak Real Estate Investment III.
For the first close, the firm mainly targeted existing investors but is now planning on soliciting capital from other institutional investors in Europe.
In the fund's marketing document obtained by PERE, the firm has stated that the current market conditions offer a window of opportunity to investors, listing widespread urbanization and infrastructure investments in China as some of the draws. It goes on to add that real estate investments are less volatile than equity investments, in a bid to attract investors who are looking to move away from the turbulent stock market.
White Peak Real Estate mainly focuses on commercial and residential property developments in the cities located in the Shandong province in the Eastern part of China. Similar to the target markets for Fund I and Fund II, capital raised via Fund III would also be invested in the northern and eastern regions of the country, including Beijing. PERE understands that the firm has a pipeline of projects, and will be deploying the capital raised so far in residential projects within the next two months. It has set a 20 percent IRR target for the fund.
White Peak Real Estate Investment Fund II, which raised RMB 974 million, was fully invested as of December last year. Fund I, which was launched in 2007, raised RMB 713 million and White Peak is now exiting investments from the vehicle.
Founded in 2007, White Peak Real Estate is a Beijing-headquartered fund manager with an in-house development platform. Jesper Jos Olsson is its founding partner and chief executive officer. In 2013, the firm also opened an office in Hong Kong to assist in fund management.
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