Harvest Capital attracts $325 million for China development fund

The Hong Kong-based private equity real estate firm has held a closing of more than $325 million for its CR China Retail Real Estate Development Fund I. The firm, majority-owned by state-owned China Resources Group, is aiming to raise $500m for the fund in total.

Harvest Capital Partners, the Hong Kong-based private equity real estate firm majority-owned by state-owned China Resources Group, has closed on more than $325 million in equity for a development fund aimed at investments in retail assets in China.

Harvest hit the fundraising trail in January for the fund, which is targeting total commitments of $500 million, alongside another fund which is targeting $300 million for investments in income-producing assets. Both funds will acquire assets in China’s tier II and tier III cities.

George Agethen, head of capital raising and business development at Harvest, said: “Given the challenging capital raising environment, achieving a first close for the fund of such a meaningful size in a short period of time is of great significance.”

The fund, which follows three existing funds currently managed by Harvest, has a pre-identified pipeline of development assets in which to invest its capital. The assets are to be developed by SZITIC Commercial Property, a Shenzhen-based development firm in which China Resources is also a shareholder.

Harvest aims to provide investors with a return of more than 20 percent from the six-year vehicle and to deploy leverage at a loan- to-value ratio of a maximum of 50 percent.

See the June issue of PERE for more on the closing.