CapitaLand steps up capital management in China through funds platform

SINGAPORE: CapitaLand has been strengthening its portfolio by leveraging its robust fund management platform and there will be more reconstitution opportunities for its expanded portfolio further to the completion of the Ascendas-Singbridge transaction.


This and other growth strategies will be shared by CapitaLand’s senior management at an event later today that will unveil Raffles City The Bund as the name of the Group’s 10th Raffles City development globally and its third in Shanghai.

The event will be officiated by Guest-of-Honour Edwin Tong, Singapore’s Senior Minister of State for Law & Health, in the presence of more than 200 distinguished guests. As part of its capital management strategy in China, CapitaLand has entered into an agreement to divest its interest in companies that hold Innov Center in Shanghai’s Yangpu District to CapitaLand Asia Partners I at a price that takes into account an agreed property value of RMB 3.101 billion (about S$621million).


Targeted for completion in 3Q 2019, the proposed injection of Innov Center into Capital Asia Partners (CAP I) comes a month after the discretionary real estate equity fund’s first closing. Other pipeline assets for CAP I include Pufa Tower, an office development in Shanghai’s prime Lujiazui CBD.

Lee Chee Koon, President & Group CEO, CapitaLand Group, said: “Shanghai Innov Center, a predominantly office integrated development located in a mature, technology-focused decentralised office market, was acquired in 2017 to be the seed asset to kickstart CapitaLand’s discretionary fund business. Since acquisition, CapitaLand, through our market-leading asset management capabilities, has successfully added significant value to the property through asset enhancement initiative and active leasing management, to meaningfully de-risk the property on behalf of CAP I investors. Upon the successful first closing of CAPI, the property will now be transferred to the fund from CapitaLand’s balance sheet.”

Lee added: “Active and disciplined asset recycling is an important part of CapitaLand’s strategy to enhance returns and to rejuvenate and rebalance our portfolio. To this end, we have set an annual divestment target of at least S$3 billion. Looking ahead, CapitaLand’s transformational transaction to acquire the business of Ascendas-Singbridge will strengthen our development pipeline, expand our slate of REITs and funds ,and increase our scale in investment properties across geographies and asset classes. The enlarged CapitaLand entity will also provide us with a robust pipeline of assets to enrichour fund management platformtobuild scale, synergy and sustainable growthin our core markets.”

Lucas Loh, President & CEO of China, CapitaLand Group, said: “CapitaLand’s signature Raffles City portfolio demonstrates our established developer-owner-operator capabilities; it is also a hallmark of our successful fund management strategy in China. By working with capital partners in our investments, we have greater agility to seize quality acquisition opportunities. This is exemplified in the 50:50 joint venture between CapitaLand’s Raffles City China Investment Partners III3and Singapore’s sovereign wealth fund GIC to acquire Raffles City The Bund last year. This landmark integrated development located in the heart of Shanghai’s North Bund has obtained Temporary Occupation Permit this month and will be opening in phases from 2H 2019.”

Loh added: “With the added development expertise and opportunities in the urban development, business park and industrial sectors from the assimilation of Ascendas-Singbridge’s business, the enlarged CapitaLand portfolio will sharpen our competitive advantage across our five core city clusters in China. Leveraging our end-to-end value chain offerings ranging from investment and fund management to development and operations, we look forward to enhancing CapitaLand’s real estate ecosystem with our partners to meet the changing needs of Chinese consumers as China enters new stages of urbanisation and urban renewal.

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