Hong Kong-based real asset manager ESR Group has established its largest-ever RMB income fund in China.
ESR has established the fund with one of China’s leading insurance companies, launching with a total investment capacity of approximately RMB ¥10 billion.
The fund will be seeded with a prime logistics portfolio of ¥ 2.3 billion (total GFA over 350,000 sqm) from ESR’s balance sheet, and the transaction is expected to be closed in the second half of this year, subject to regulatory approvals.
The seed portfolio contains 6 stabilised assets strategically located in major logistics and industrial hubs across different regions in China, including the Yangtze River Delta Region, the Greater Bay Area, and the Beijing-Tianjin-Hebei Region.
Moreover, ESR aims to increase its rooftop solar power generation for selected assets of the portfolio to further its decarbonisation effortsin line with the Group’s ESG 2030 Roadmap to set up 1,000 MW of solar power capacity on the rooftop of assets.
Jeffrey Shen, ESR Group Co-founder and Co-CEO, said: “ESR is very proud of our largest-ever RMB income fund in China despite the challenging macro-economic environment. This milestone achievement testifies to the strong relationships and track record which ESR has built with domestic RMB investors, and the compelling long-term income potential of our portfolio of well-located and premium logistics assets in China. We thank our capital partner, one of China’s leading insurance companies, for their continuous support and will actively expand the portfolio of this new venture with high quality assets. This initiative is also in line with ESR’s focus on accelerating our asset-light strategy, which will enable us to recycle the capital, further grow our fund management fee business and seize on opportunities to reinforce our leadership position in New Economy real estate across APAC.”
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