Grosvenor, Harvest JV halts Chinese investments

The China-focused joint venture investment management platform formed two years ago is to switch focus to advising Chinese institutions on overseas investments.

Harvest Real Estate Investments (HREI), the joint venture investment management platform formed two years ago by asset managers London-based Grosvenor Fund Management and Beijing-based Harvest Fund Management is to stop investing in China.

It is understood the partners have decided to switch focus to advising Chinese investors on making real estate investments overseas.

That means there no longer is a role for the JV’s head Rong Ren, a veteran China investment professional, who has agreed to leave the company.

Ren was unavailable for comment but he is thought now to be keen on a role with a Chinese institutional investor and to broaden his horizons from real estate to include private equity investments also.

Ren assumed leadership of the JV after leaving Harvest Capital Partners, the private equity real estate business of state-controlled conglomerate China Resources. Similarly, his departure from Harvest Capital happened amid a strategic shift by China Resources.

He brought across with him 10 staff, including well known capital raiser George Agethen. Agethen also is understood to have departed. It is unclear at this stage what the strategy shift means for the remaining staff.

Also wound up was HREI’s debut fund, HREI China Total Return Fund, for which the JV was targeting $500 million. The JV did not hold a capital closing for the vehicle. It was intended to be raised for investments in retail, office and residential properties in China’s tier 1 cities.

HREI did build up assets under management valued at $460 million, comprising two assets in China, including a $277 million shopping centre in Shanghai. Both transactions were financed by Chinese institutional investors and completed via separate account mandates. The management of these is expected to remain with those staff that are left.

Grosvenor also was unavailable for comment by press time.