Star Capital brings capital haul to RMB2.3bn

The private equity real estate firm majority-owned by Chinese conglomerate Fosun International has however warned fundraising will be slower this year as a reflection of Chinese real estate regulations and controls.

Chinese private equity real estate firm Star Capital has brought the capital commitments of its third private equity real estate fund to RMB2.3 billion (€271 million; $370 million), PERE can reveal.

The capital came from 150 investors, according to a Star spokeswoman. The majority of Star’s capital is coming from its stable of high-net-worth individuals, which in the past have included high-profile Chinese businessmen such as Jack Ma, founder of online retailer Alibaba, and Guangchang Guo, chairman of Fosun International.

The second closing follows a first closing at RMB1.1 billion first close in August. Fosun has committed to putting up 15 percent of the fund’s equity. For the first close it invested RMB155 million.

Star has three strategies for the fund: subordinated equity investments, preferred equity investments and investments in real estate debt.

Star, which is 80 percent owned by Chinese conglomerate Fosun International, first launched Star Capital Investment Fund III in May of last year with a target of RMB4.5 billion and a hard cap of RMB6 billion, which would compare with the largest dollar-denominated vehicles to have been raised for Chinese real estate investments.

However, Star’s spokeswoman told PERE: “Because of Mainland China’s regulations and controls on the real estate industry, we have slowed the pace of fundraising for our vehicle. Consequently, she warned that the final total raised for the fund might fall short of its original target.

Further, she said capital was being raised to reflect specific investments. She said: “This year, we are continuing to fundraise according to the speed of our investments.”

When Star launched Fund III, it also disclosed plans to set up a $200 million offshore real estate fund, and had hoped to start fundraising for it by the end of last year. As of now, however, there are no further updates on the US dollar-denominated fund, the spokeswoman said.